By Sinéad Carew and Marc Jones
NEW YORK/LONDON (Reuters) – World shares rose with the dollar and Treasury yields on Thursday after U.S. President Donald Trump outlined a trade agreement with Britain the day after the U.S. Federal Reserve took a wait-and-see stance on interest rates.
In cryptocurrencies, bitcoin gained 4.83% to $101,440.22. Ethereum rose 14.72% to $2,063.23.
The U.S.-British trade agreement was the first deal announced since Trump kicked off a 90-day pause on tariffs imposed on many U.S. trading partners a month ago to give his administration time to negotiate with other countries.
Investors are also awaiting planned talks between U.S. and Chinese officials in Switzerland during the weekend, potentially a first step in dialing down the damaging trade war between the world’s two biggest economies.
While investors have been enthusiastic about any signals from the Trump administration that it was in trade talks over the past month, they had been showing signs of frustration this week over the lack of concrete details.
“Investors are relieved that there is some progress being made in trade deals,” said Gene Goldman, chief investment officer at Cetera Investment Management, adding that “it seems like the administration is moving in the right direction.”
And Goldman said the U.S.-British agreement, while still being worked on, “provides a little optimism going into the weekend negotiations with China.”
On Wall Street, indexes extended gains after the trade announcement. At 11:51 a.m. (1551 GMT), the Dow Jones Industrial Average rose 573.16 points, or 1.39%, to 41,685.11, the S&P 500 rose 77.14 points, or 1.37%, to 5,708.56 and the Nasdaq Composite rose 311.92 points, or 1.76%, to 18,050.09.
MSCI’s gauge of stocks across the globe rose 5.72 points, or 0.68%, to 849.75 while the pan-European STOXX 600 index rose 0.44.
Investors were also still digesting the U.S. Federal Reserve’s policy update from Wednesday, when it left its interest rates in a 4.25%-4.5% range for a third straight meeting.
The U.S. central bank had warned that risks of higher inflation and higher unemployment had risen as it navigates economic uncertaintly caused by Trump’s trade policies.
In currencies, the pound lost some ground after the trade deal and a widely expected quarter-point rate cut from the Bank of England. Sterling weakened 0.14% to $1.3277.
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro,
rose 0.55% to 100.44.
The euro was down 0.48% at $1.1245 while against the Japanese yen, the dollar strengthened 1.16% to 145.49.
Elsewhere, Sweden and Norway also hinted they could also cut rates later in the year. The Swedish crown weakened 0.48% versus the dollar to 9.704.
In government bonds, the yield on benchmark U.S. 10-year notes rose 5.5 basis points to 4.33%, from 4.275% late on Wednesday, while the 30-year bond yield rose 2.9 basis points to 4.8011%.
The 2-year note yield, which typically moves in step with Fed interest rate policy expectations, rose 7.3 basis points to 3.866%, from 3.793%.
In commodities markets, where oil prices had fallen more than $1 on Wednesday, crude futures rose on Thursday, buoyed by hopes of a breakthrough in the trade talks between the United States and China, the world’s two largest oil consumers.
U.S. crude rose 3.29% to $59.98 a barrel and Brent rose to $62.93 per barrel, up 2.96% on the day.
Spot gold fell 1.09% to $3,327.49 an ounce. U.S. gold futures fell 1.48% to $3,331.30 an ounce.
(Reporting by Sinéad Carew, Johann M Cherian, Marc Jones; Editing by Chizu Nomiyama and Will Dunham)
