Global markets rally as US and China agree to 90-Day tariff truce

Global shares rallied, while gold and safe-haven currencies slumped against a resurgent dollar on Monday as the US and China agreed to temporarily slash harsh reciprocal tariffs and cooperate.

Following weekend talks in Geneva, both sides agreed that the US would drop levies on Chinese imports from 145 per cent to 30 per cent during a 90-day negotiation period and China would cut duties from 125 per cent to 10 per cent.

Wall Street stocks made significant gains, with the S&P 500 index jumping 3.3 per cent and the tech-focused Nasdaq Composite advancing 4.4 per cent.

In a joint statement on Monday, Washington and Beijing said they recognised the importance of their bilateral trade relationship to both countries and the global economy, in language that analysts said had brightened the market outlook.

An index tracking the dollar against other major currencies rose further from last month's three-year trough with an almost 1.17 per cent gain, while Japan's yen fell 2.1 per cent to 148.39 per dollar.

The retreat from safe-haven assets pushed Switzerland's franc 1.8 per cent lower on the day, in a jolt of relief for Swiss exporters and the nation's central bank.

Spot gold prices, which hit an all-time high of $3,500 last month and often move inversely to the dollar, fell 2.7 per cent to $3,234.8 an ounce.

"This is a textbook recovery after the market's waterfall declines," said Gina Bolvin, the president of Bolvin Wealth Management Group in Boston. "The market is blowing through resistance levels and if it sticks, this is a big 'WIN' for Trump, for stocks and for investors."

The euro, which surged in April as investors questioned the dollar's long-held status as the world's reserve currency, was 1.4 per cent lower at $1.1090.