Stock markets are rallying worldwide after the US and China agreed to suspend new tariffs in their trade war to allow for peace talks.
US President Donald Trump – who initiated the spat with the world's second-largest economy – announced at the weekend he would postpone tariff increases due in January for 90 days.
The decision followed a meeting at the G20 summit in Argentina with his Chinese counterpart Xi Jinping, who promised to buy more American exports in exchange for the delay.
Hopes of a breakthrough in the trade war – a major source of uncertainty for financial markets this year – helped values surge on Monday.
China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40%.
— Donald J. Trump (@realDonaldTrump) December 3, 2018
Motor stocks were among the winners after Mr Trump outlined an apparent concession from Beijing via Twitter that read: "China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40%."
China's main market index was up 2.7% while the Nikkei in Tokyo was 1% up by the close.
In London, the FTSE 100 opened 2% higher – rising more than 150 points, with its strong contingent of mining stocks seeing the biggest gains.
It was a similar story on the continent, while US futures pointed to a strong opening in New York later in the day.
Oil prices – down more than 20% last month amid renewed fears of a supply glut – also recovered some poise as investors bet on weaker damage to wider demand in the world economy.
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Brent crude was trading back above $60 a barrel at $62 after a jump of more than 5%.
The gains were aided by strong indications the OPEC group of oil-producing nations would announce production cuts to help prop up prices this week.
News early on Monday that Qatar would be leaving the bloc in January did little to dent the price recovery.
The dollar also weakened against a basket of international currencies – adding support to oil costs – though the pound remained just below $1.28 as Brexit jitters continued to dominate its position.
Market experts said that the temporary trade truce was being widely welcomed but nerves remained over corporate earnings following a mixed reporting season.
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Westpac FX analyst Robert Rennie said: "This US-China agreement is thus better characterised as a 'mini-breakthrough' that puts a momentary pause on trade tensions rather than a comprehensive policy deal.
"Deeply contentious thornier structural issues such as forced technology transfer remain unresolved," he told the Reuters news agency.
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