Trade optimism and tech rally propel US equities to record highs

US stocks surged to fresh record highs, lifted by optimism over an imminent trade breakthrough between the US and China. The S&P 500 rose just over 1% to close at 6 861, while the Dow Jones Industrial Average ended above the 47 000 mark for the first time, at 47 609. The Nasdaq Composite advanced 1.73%, supported by strong gains in the technology and communication services sectors, which led the rally, with Nvidia, Broadcom, Alphabet, and Tesla each gaining more than 2%. Traders are also bracing for a busy week ahead, as five of the Magnificent Seven tech giants prepare to release earnings reports. Meanwhile, the Federal Reserve (Fed) is widely expected to deliver another 25-basis-point rate cut later this week, adding further momentum to the positive market tone.

Investor confidence improved after Treasury Secretary Scott Bessent indicated that constructive discussions were under way ahead of the meeting between Presidents Donald Trump and Xi later this week. The proposed plan is expected to include a delay to China’s rare-earth export restrictions, the cancellation of planned 100% tariffs on Chinese goods due to take effect next month, and the resumption of Chinese soybean purchases. These measures have raised expectations of smoother trade flows and stronger corporate profitability.

Asian markets ended the day on a high note, supported by global trade optimism and accommodative monetary policy expectations. Japan’s Nikkei 225 closed at around 2.50%, breaking above the 50 000 level, as investors reacted positively to the upbeat international backdrop and domestic policy support. In China, the CSI 300 gained about 1.20%, while Hong Kong’s Hang Seng Index rose roughly 1.10%, with sentiment improving on signs that the US and China may soon ease trade barriers. 

European equities reached fresh record highs on Monday, driven by optimism over improving US–China trade relations, which supported the global growth outlook. The Eurozone’s STOXX 50 gained 0.60% to close at 5 711, while the broader STOXX 600 edged up 0.20% to 577, both marking all-time highs. Germany’s DAX rose 0.30% to 24 309, its highest level in nearly a week. The FTSE 100, however, hovered near 9 650 but lagged its European peers, weighed down by a sharp decline in precious metal prices. Looking ahead, the European Central Bank is expected to keep interest rates unchanged.
In South Africa, equities fell, with the FTSE/JSE All Share Index retreating 1.57% amid softer global risk sentiment. The JSE Resource Index led the losses, dropping 7.06%, while the rand strengthened slightly, trading around 17.21 against the US dollar, supported by modest inflows and relative currency resilience.

On Friday, the country was officially removed from the Financial Action Task Force (FATF) grey list. President Cyril Ramaphosa noted in his newsletter on Monday that the milestone “is a boost for South Africa’s international reputation and global standing. Greylisting can make a country appear risky to investors.” He added: “International investors seeking to do business in any country need assurance that its financial system is clean, transparent, robust and compliant with global standards.”

Commodities ended the day lower as easing trade tensions reduced demand for safe-haven assets. Platinum slipped to around $1 560 per ounce, down from its mid-October peak of $1 722. Gold fell 2.51%, while Brent crude oil declined, reflecting a cautious shift in investor positioning amid the improving global economic backdrop.