News US and China will resume trade talks supports risk appetite

China’s commerce ministry statement Beijing and Washington had set a tentative date for “early October” meeting for trade negotiations underlined risk on trading that dominated global equity markets last week. The SP 500 joined Dow and Nasdaq in breakouts from month-long consolidation triangles, extending gains 1.5%. The ICE US dollar index turned 0.5% lower.

Nikkei and Hang Seng joined four other largest developed market indexes advance last week. Hang Seng was the gains leader: it rallied 3.8%. Five out of six major currency pairs reversed previous week’s dynamics, and the range of major currency pairs’ weekly fluctuations narrowed slightly while it shifted up. 3 The Australian dollar was the leader in terms of percentage change: it rose 1.7% against the US dollar.

The highlight of major market moving events this week is the European Central Bank policy meeting Thursday. The ECB is widely expected to cut deposit rates further into negative territory, and most experts anticipate resumption of monthly asset purchases of 30 billion euros from October.