Markets in risk-on mood amid hopes of US-China trade deal – business live

Rolling coverage of the latest economic and financial news

  • Introduction: Mnuchin says trade talks going well
  • Reuters: US drops key demand to get deal
  • Coming up: Goldman Sachs financial results

8.33am BST

European banking stocks have hit their highest level
since early October, as trading gets underway.

The Stoxx 600 Europe Banks index has gained almost, lifted by
hopes that the US-China trade war could ease – potentially giving
global growth a boost.

8.16am BST

Optimism that US firms will report decent results for
the last quarter is also boosting markets, says Konstantinos
Anthis, Head of Research at ADSS.

JP Morgan got the earnings season off to a strong start on
Friday, beating forecasts with record profits and revenues. If
Goldman Sachs does the same today, then the markets could be jolted
higher.

The risk on sentiment is the key theme in the markets at
the start of the week after a strong close for most instruments on
Friday.
High beta currencies gained across the board,
equities rallied, Treasury yields moved higher and Gold retreated.
This a typical risk on environment and it begs the question whether
investors are right to be so cheerful. In any case, Easter price
action is just around the corner and with the US earnings’ season
in full swing more volatility is expected to keep market
participants on their toes.

An improvement in risk sentiment is what seems to drive
investors’ appetite at this stage. The Euro, the commodity
dollars, the greenback against the Yen, all rallied on Friday. At
the same time, Gold moved lower while equities were pushing towards
more gains targeting fresh highs for the year. However,
what makes sense to mention here is that the only
meaningful catalyst behind this move higher was that banks reported
better earnings for Q1, which sound too simplistic as a credible
market driver.
Should we be worried?

Source: FS – All-News2-Economy
Markets in risk-on mood amid hopes of US-China trade deal – business live