Will Trump’s China trade deal, Fed rate cut, and big tech earnings ignite a global market boom this week?

Global financial markets opened the week on a high note, with Dow Jones futures climbing more than 0.6% on renewed optimism about a potential U.S.-China trade deal and anticipation of a Federal Reserve rate cut. The wave of investor enthusiasm follows record-breaking highs on Wall Street last Friday, marking what analysts describe as a “pivotal week” for the global economy.

According to early reports, negotiations between U.S. and Chinese officials in Malaysia ended positively, paving the way for President Donald Trump and Chinese President Xi Jinping to meet in South Korea later this week to finalize a long-awaited trade accord.

Treasury Secretary Scott Bessent confirmed that Washington and Beijing had reached a “very substantial framework,” signaling that months of trade tensions might finally ease. In response, Asian stocks soared — Japan’s Nikkei 225 topped 50,000 points for the first time, while South Korea’s Kospi and Hong Kong’s Hang Seng each rallied more than 1%.

Wall Street Eyes Federal Reserve’s Expected Rate Cut

Markets are also laser-focused on the U.S. Federal Reserve’s meeting this Wednesday, where a rate cut is widely expected. The move, analysts say, could strengthen investor confidence and sustain the current market rally.

“Another rate cut at this stage will likely provide the liquidity the market needs,” said a Bloomberg analyst, adding that the Fed’s decision could be coupled with a pause in quantitative tightening.

The Dow Jones Industrial Average closed last week above 47,000 points for the first time in history. The S&P 500 and Nasdaq also ended the week at record levels, fueled by easing inflation data and positive earnings sentiment.

Tech Titans Prepare for Earnings Tsunami

In what could be the defining moment of the earnings season, Big Tech firms — including Apple, Microsoft, Alphabet (Google), Amazon, and Meta Platforms — are scheduled to release their quarterly results this week.

These companies are at the center of the artificial intelligence boom that has driven much of 2025’s stock market gains. Investors are closely watching whether their capital spending on AI and cloud infrastructure will continue to accelerate.

AI chipmakers like Nvidia and Broadcom, both currently in buy zones, could see significant market swings depending on the tech giants’ earnings guidance. Meanwhile, Apple’s iPhone 17 sales and Microsoft’s PC refresh cycle will also shape investor sentiment.

Trade Hopes Lift Global Commodities

Optimism around a U.S.-China deal has extended beyond equities. Oil prices edged higher on expectations of stronger trade flows and reduced geopolitical risk. Brent crude rose to $61.50 per barrel, while gold — a traditional safe-haven asset — fell by 1%, signaling investors’ return to riskier assets.

Analysts also note that China’s willingness to delay restrictions on rare earth exports has reassured global manufacturers, potentially easing pressure on the tech supply chain.

Trump’s Diplomatic Marathon

President Trump’s Asia tour is shaping up to be one of his most consequential trips in recent years. Following the Malaysia talks, Trump announced several new trade pacts with Thailand, Vietnam, and Cambodia. He also hinted at a forthcoming trade deal with Brazil after discussions with President Luiz Inácio Lula da Silva.

However, the U.S.-Canada relationship remains tense. Over the weekend, Trump announced an additional 10% tariff on Canadian goods, reacting to what he described as “anti-tariff propaganda” from Ontario officials.

Market Outlook: Bullish but Cautious

While investors are upbeat, analysts urge caution amid the flurry of earnings, policy announcements, and geopolitical developments. “This week is a perfect storm — everything from Fed decisions to Big Tech earnings could change the direction of markets overnight,” said an analyst at Morgan Stanley.

Still, the consensus remains optimistic: if the U.S. and China seal a trade deal and the Fed delivers another cut, markets could enter a new phase of sustained growth.

FAQs

1. What is driving the stock market rally this week?
The rally is largely driven by optimism over a potential U.S.-China trade deal, expectations of a Fed rate cut, and strong Big Tech earnings.

2. When will the Trump-Xi meeting take place?
The meeting is scheduled for Friday, October 31, on the sidelines of the APEC summit in South Korea.

3. Why is the Fed expected to cut rates again?
The central bank aims to sustain economic growth amid cooling inflation and global trade uncertainty.

4. Which companies are reporting earnings this week?
Apple, Microsoft, Amazon, Google, and Meta lead this week’s earnings reports.

5. How have Asian markets reacted?
Asian markets, including Japan’s Nikkei and South Korea’s Kospi, hit record highs on optimism surrounding the trade negotiations.