After the Sino-US talks, the stock market and the US dollar both rose, while safe-haven assets came under pressure. However, market participants warned that uncertainties still exist.

With the progress of the Geneva economic and trade talks between China, the US, and Japan, the market's optimism about the easing of trade tensions has been boosted, leading to a surge in US stock futures and the US dollar. As of the time of writing, Dow Jones futures rose by 1.83%, S&P 500 futures rose by 2.40%, and Nasdaq futures surged by 3.45%. At the same time, the US Dollar Index (DXY) rose by 1.27%, reaching 101.61. Safe-haven assets, on the other hand, generally fell. The Euro, Yen, and Swiss Franc, which had been used as safe-haven instruments during the period of funds fleeing US assets, saw significant declines. The yield on benchmark 10-year US Treasury bonds rose by about 7 basis points to 4.447%. Spot gold fell by nearly 3%, to around $3232 per ounce. According to reports, on May 10th and 11th local time, China and the US held high-level economic and trade talks in Geneva, Switzerland. The talks reached a series of important consensus and made substantial progress. On May 12th local time, China and the US issued a joint statement on the Geneva economic and trade talks. Both parties pledged to take the following measures by May 14, 2025: The US will (1) amend the ad valorem tariffs on Chinese goods (including goods from the Hong Kong and Macau Special Administrative Regions) imposed under Executive Order 14257 dated April 2, 2025, with 24% of the tariffs suspended within the first 90 days and the remaining 10% tariffs imposed according to the provisions of the order; (2) cancel the additional tariffs imposed on these goods under Executive Orders 14259 dated April 8, 2025, and 14266 dated April 9, 2025. China will (1) correspondingly modify the ad valorem tariffs imposed on US goods as specified in State Council Announcement No.4 of 2025, with 24% of the tariffs suspended within the first 90 days and the remaining 10% tariffs imposed on these goods, and cancel the additional tariffs imposed on these goods under State Council Announcements No.5 and No.6 of 2025; (2) take necessary measures to suspend or cancel non-tariff retaliatory measures against the US effective April 2, 2025. Below are comments from several market participants on the latest developments in the China-US economic and trade talks. Chief Market Analyst at Nordea, Jan von Gerich, stated, "The market has fully embraced this. But I still have some doubts personally. If we really wanted low tariffs, why would this be accomplished in this way? The market is still volatile, and uncertainties are high." "I still worry that there will be variables in the end. Although a preliminary agreement has been reached now, the details may not necessarily satisfy both parties, and there may be other issues. Of course, all of this needs time to verify. I won't fully embrace all the news I hear now, just as we saw on 'Liberation Day,' there is still fluctuation." Jane Foley, Head of Foreign Exchange Strategy at Rabobank stated, "The market had already reacted ahead of time last night, and now that we have more details, the market continues the overnight trend, buying the dollar. A scenario we see is that the dollar is now being viewed as a risk asset and is rising." "The US has provided assurances that negotiations will continue. The negotiation atmosphere is positive, and both China and the US do not want to decouple, so there is optimism in the market that tariffs will not have a catastrophic impact, and the market as a whole is relieved." She added, "But this does not mean that we are returning to the pre-Trump era. Currently, there is still a baseline tariff of 10%, and this 90-day pause is just the beginning of a countdown. Overall, the situation is not as bad as before, but there is still considerable uncertainty about how these tariffs will ultimately land and their impact on global central bank policies." Senior Foreign Exchange and Interest Rate Strategist at Societe Generale, Kenneth Broux, said, "The trade tensions between China and the US have eased. This is a step in the right direction and is beneficial for US assets and the US economy." "The dollar has lagged behind other markets in its rebound since the April low. The US stock market has returned to the level of April 2, as have bond yields, but the dollar has actually been lagging. Now, market conditions are forming favorably for a larger adjustment and recovery of the dollar, catching up with the stock and bond markets." Chief Economist at Pinpoint Asset Management in Hong Kong, Zhiwei Zhang, said, "This is better than I expected. I originally thought that the tariff level would be reduced to about 50%, but now the reduction is even greater. Obviously, this is very positive news for the economies of both countries and the global economy, and it also makes investors less worried about the short-term disruption to the global supply chain." "But we also need to remember that this is a temporary tariff reduction for three months. So this is just the beginning of a long process. It may take both sides several months to reach a solution or final trade agreement, but this is already a very good starting point."