Wall Street futures rally up to 1.7% on Donald Trump's 'don't worry about China' comment

Wall Street futures rally up to 1.7% on Donald Trump's latest comment. 

Wall Street futures rose sharply in early trade on Monday (India time), signalling a firm opening for U.S. markets later in the day, after President Donald Trump struck a conciliatory tone on trade relations with China.

Futures linked to the Nasdaq 100 gained 1.7 percent, S&P 500 futures rose 1.2 percent, and Dow Jones Industrial Average futures advanced 0.9 percent around 10:45 am IST, indicating a rebound from last week’s sharp sell-off.

The uptick came after Trump appeared to soften his earlier aggressive stance on tariffs against China. The U.S. president, who had threatened to impose 100 percent tariffs on Chinese goods from November 1, posted over the weekend that "everything will be fine" and the United States did not want to "hurt" China.

In a post on Truth Social, Trump wrote: "Don’t worry about China, it will all be fine! Highly respected President Xi just had a bad moment. He doesn’t want Depression for his country, and neither do I. The U.S.A. wants to help China, not hurt it!!!"

Markets also took note that Beijing, while defending its curbs on exports of rare earth elements as a response to U.S. measures, refrained from announcing new retaliatory tariffs. The move was seen as a sign of restraint from China.

"We expect the ultimate resolution will be an extension of the current tariff pause past November 10 along with some new but limited concessions from both sides," Goldman Sachs chief economist Jan Hatzius said in a note, reported Reuters.

Ponmudi R, CEO of Enrich Money, told PTI investor sentiment remained cautious after the earlier announcement of steep U.S. tariffs rekindled trade war fears.

"Although President Trump later softened his stance, saying the U.S. does not intend to ‘hurt China,’ which led to a recovery in U.S. stock futures, investor caution persists amid renewed global uncertainty," he said.

On Friday, U.S. markets had closed sharply lower. The Nasdaq Composite fell 3.56 percent, the S&P 500 declined 2.71 percent, and the Dow Jones Industrial Average dropped 1.9 percent.

European shares were trading lower, with the pan-European STOXX 600 down 1.2 percent, while France’s CAC 40 and Germany’s DAX both declined 1.5 percent.

In Asia, key indices including South Korea’s Kospi, Shanghai’s SSE Composite Index and Hong Kong’s Hang Seng were trading lower.

Back home, domestic benchmarks followed global cues. Sensex fell 451.82 points to 82,049 in early trade, while the Nifty declined 109.55 points to 25,175.80.

Most leading cryptocurrencies also bounced back after sharp declines post a weekend selloff, following President Donald Trump’s efforts to ease worries about trade tensions between the United States and China. According to data from CoinGecko, the total market capitalization of all cryptocurrencies climbed over 6%, surpassing the $4 trillion mark on Monday. Bitcoin traded around $115,000 in London that morning, recovering from a drop below $105,000 in the U.S. on Friday, reported Bloomberg.

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