US President Donald Trump and his Chinese counterpart Xi Jinping agreed to pause the introduction of new tariffs and intensify their trade talks.
S&P 500 Index futures jumped over 1.5%, while the Aussie and the currencies of South Africa, Turkey and Mexico all rose. Contracts also pointed to gains for Asian equities on Monday.
Havens such as the Japanese yen slipped and the greenback was lower against most of its large developed-market counterparts.
Crude climbed on an agreement between Saudi Arabia and Russia.
“This is the best outcome that we had hoped for out of this meeting,” said Frances Cheung, head of Asia macro strategy at Westpac Banking Corp.
While far from resolved completely, the easing in tensions between the leaders of the world’s largest economies goes some way to lifting sentiment that’s been weighed down by concerns the trade war is damaging global economic growth.
Last week, dovish comments from the Federal Reserve helped propel a revival in risk taking.
Trump and Xi promised to halt any new tariffs for 90 days as the countries continue negotiations.
The US had been scheduled to push ahead on Jan 1 with increased tariffs on US$200 billion (RM836 billion) worth of Chinese goods, but that’s now been paused.
Another meeting on the summit sidelines could also prove key for markets, with Russian President Vladimir Putin announcing that he and Saudi Arabia’s Crown Prince Mohammed bin Salman had agreed to extend into 2019 their deal to manage the oil market.
Elsewhere, the pound slipped as the threat of a vote to bring down British Prime Minister Theresa May’s government looms should Parliament reject her Brexit deal.
That raises the stakes even further as lawmakers begin debating her plan this week.