Global stocks rebounded yesterday after US President Donald Trump said he would delay a hike in tariffs on Chinese goods, citing “substantial progress” in trade talks and fuelling hopes of an end to the long-running stand-off.

Most key European markets were firmly in the black, but London underperformed, while Wall Street opened higher.

Earlier, Shanghai had spearheaded gains across Asia with a surge of more than five per cent, while Hong Kong and Tokyo each rose 0.5 per cent in value.

Optimism over the negotiations had already provided support to global equities in January and February, but the president's comments gave extra ammunition to investors to ramp up buying.

“Global markets are on the rise as markets celebrate the news of an indefinite delay to the deadline beyond which US will ramp up tariffs on Chinese imports,” said IG analyst Joshua Mahony.

“Donald Trump’s decision to push back the March 1 deadline comes amid significant progress on a number of crucial fronts, including intellectual property protection, technology transfer, agriculture, services and currency. The fact that the US are seeking to address the value of the Chinese currency is of particular interest to markets.”

The news fired currency markets with the yuan extending gains to a seven-month high, while other high-yielding, riskier units were also up against the dollar.

Mr Trump said on Twitter that the US “has made substantial progress in trade talks with China on structural issues including intellectual property protection, technology transfer, agriculture, services, currency and other issues.”

 “As a result of these very productive talks, I will be delaying the US increase in tariffs now scheduled for March 1.”

Mr Trump also said he planned to hold a summit with his Chinese counterpart Xi Jinping at his Mar-a-Lago estate in Florida to sign a deal.

China’s Xinhua news agency added that the two sides had “made substantial progress on specific issues” including on transfer of technology, intellectual property and agriculture.

Mr Trump also made a splash in the oil market, causing petroleum prices to fall by more than a dollar per barrel when he urged Opec to help cut “high” prices and aid the “fragile” world economy. 

“Oil prices getting too high. OPEC, please relax and take it easy,” Mr Trump tweeted.

Britain and the United States, meanwhile, agreed yesterday to hold on to their system of handling multi-trillion dollar financial transactions to avoid market uncertainty following Brexit.

The UK and US carry out trades of derivatives worth a combined $2.4 trillion daily, Bank of England governor Mark Carney told a press conference in London. (AFP)

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