Wall Street traders welcomed an ISM survey that showed activity in the US service sector jumping in October (Daniel ROLAND)

London (AFP) – Global stock markets posted mostly modest gains Tuesday as dogged trade optimism roused those ready to take on more risk.

Global bourses had sailed higher Monday on anticipation that economic superpowers China and the United States were close to breaking a deadlock in trade talks.

Those gains were buttressed Tuesday by reports that US President Donald Trump might cut some tariffs on Chinese goods.

“Put simply, it has been another risk-on day,” remarked Fawad Razaqzada, an analyst at Forex.com.

Markets also rose on a reported easing in China’s one-year lending rate, while London traders welcomed a survey that showed Britain’s crucial services sector had avoided contraction in October.

“With the PBoC (People’s Bank of China) deciding to cut the one-year medium-term lending rate in China, it is clear that the bank remains committed to supporting the Chinese economy while negotiators work on removing the current US tariffs,” said IG analyst Joshua Mahony.

The Financial Times and Wall Street Journal said Tuesday that the White House is considering dropping existing tariffs on more than $100 billion of imports to seal a mooted deal with China that has teased investors many times already.

“When the US blinks, the world takes notice,” quipped analyst Neil Wilson at Markets.com.

“The US and China seem to be inching closer to sealing the phase one deal, although there are still hurdles,” he said.

The FT cited unnamed sources as saying officials were looking at rolling back levies on a range of imports including clothing, appliances, and flatscreen monitors that have been subject to 15-percent rates since September 1.

Meanwhile, a Bloomberg News article said Chinese officials were looking at locations in the United States where President Xi Jinping and Trump could hold a signing ceremony as early as this month.

In Asia, Tokyo led gainers as it reopened after a long weekend to play catch-up with Monday’s rally.

The Nikkei ended 1.8 percent higher, while Shanghai rose 0.5 percent and Sydney added 0.2 percent.

Hong Kong won 0.5 percent as investors brushed off data showing a key measure of business confidence fell to its lowest level in more than a decade as the city reels from global trade woes and violent protests.

Trading was moderately upbeat in New York, with the blue-chip Dow index up by 0.1 percent in midday exchanges after a survey by the Institute for Supply Management showed that activity in the US service sector jumped unexpectedly in October, a welcome sign of sustained growth.

The dollar also gained ground.

 – Key figures around 1645 GMT – 

New York – Dow: UP 0.1 percent at 27,495.84 points

London – FTSE 100: UP 0.3 percent at 7,388.08 (close)

Frankfurt – DAX 30: UP 0.1 percent at 13,148.50 (close)

Paris – CAC 40: UP 0.4 percent at 5,846.89  (close)

EURO STOXX 50: UP 0.3 percent at 3,676.52

Tokyo – Nikkei 225: UP 1.8 percent at 23,251.99 (close)

Hong Kong – Hang Seng: UP 0.5 percent at 27,683.40 (close)

Shanghai – Composite: UP 0.5 percent at 2,991.56 (close)

Euro/dollar: DOWN at $1.1065 from $1.1128 at 2100 GMT

Dollar/yen: UP at 109.15 yen from 108.58 yen

Pound/dollar: DOWN at $1.2862 from $1.2884 

Euro/pound: DOWN at 86.02 pence from 86.37 pence

Brent North Sea crude: UP 1.3 percent at $62.92 per barrel

West Texas Intermediate: UP 1.2 percent at $57.20

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Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.