By Lawrence White
LONDON (Reuters) -Shares climbed worldwide and the dollar held gains on Tuesday as market participants entered a key week for US earnings, inflation data and trade talks in a relatively optimistic mood.
Oil prices edged lower after U.S. President Donald Trump issued a 50-day deadline for Russia to end the war in Ukraine to avoid energy sanctions.
Trump signalled he was open to discussions on tariffs after his weekend threat to impose 30% duties on the European Union and Mexico from August 1. Japan is reportedly trying to schedule high-level talks with the U.S. this Friday.
Market reaction to the tariff uncertainty has been benign, making earnings in the United States this week all the more important for cues.
MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.8%, while Europe’s STOXX benchmark rose 0.2% and Nasdaq futures <NQc1> gained after Nvidia said it would resume sales of its H20 chips to China.
The EU accused the U.S. of resisting efforts to strike a trade deal and warned of countermeasures if no agreement is reached. Trump said he was open to talks with the EU and other trading partners.
Japan’s Prime Minister Shigeru Ishiba is arranging to meet U.S. Treasury Secretary Scott Bessent in Tokyo on Friday, the Yomiuri newspaper reported, ahead of an August 1 deadline before 25% tariffs are due to take effect.
Ishiba also has an election to contend with on Sunday, with polls showing his ruling coalition may lose their majority in the upper house to political opponents who are advocating for expansive spending. Japanese government bonds plunged, with the benchmark 10-year yield rising to 1.595%, its highest since October 2008.
Data showed China’s economy slowed less than expected in the second quarter in a show of resilience against U.S. tariffs.
Nvidia CEO Jensen Huang is scheduled to visit the country on Wednesday, with his company now planning to resume sales of its H20 artificial intelligence chips in the market.
U.S. EARNINGS IN FOCUS
Meanwhile, the U.S. earnings season is set to begin on Tuesday, with second-quarter reports from major banks. S&P 500 profits are expected to rise 5.8% year-over-year, according to LSEG data. The outlook has dimmed sharply since the early April forecast of 10.2% growth, before Trump launched his trade war.
Trump’s renewed verbal attacks on Federal Reserve chair Jerome Powell in recent weeks also offered markets a reminder of the turmoil that his sometimes abrupt decision-making can unleash, analysts said.
Investors are also waiting for U.S. consumer price data for June, due on Tuesday, and will monitor for any upward pressure on prices from tariffs.
The dollar was little changed at 147.62 yen after touching a three-week high. The euro edged up 0.1% to $1.1680 after four days of losses.
U.S. crude dipped 0.6% to $66.56 a barrel. Trump announced new weapons shipments for Ukraine on Monday, and threatened sanctions on buyers of Russian exports unless Moscow agrees to a peace deal in 50 days.
Gold strengthened 0.5% at $3,358 per ounce, while spot silver gained 0.3% to $38.25 per ounce, after hitting its highest level since September 2011 in the previous session.
(Reporting by Lawrence White in London and Rocky Swift in Tokyo; Editing by Sonali Paul and Bernadette Baum)
