Trade Truce Extension Lifted Global Market Sentiment
Investors are seeing renewed confidence as a two-month U.S.-China trade truce reduces tariff risks for global portfolios.
Updated on Sept. 27, 2026 in Stock Markets
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The United States and China have extended their trade truce by two months, a move that prompted a rebound in global equity and futures markets. The FBM KLCI rose 6.06 points over the past week to settle at 1,671.62.
Why it matters
The extension of the trade truce provides immediate relief by lowering the risk of tariff escalations before year-end, which helps stabilize global market sentiment. This improved risk appetite has encouraged investors to increase positions in large-cap equities.
The FBM KLCI rose to 1,671.62 this week, gaining 6.06 points and moving above its year-to-date low of 1,656.83. Trading activity reached 145,235 lots with total open interest across contracts sitting at 145,426.
The players
United States
A major participant in international trade negotiations affecting global economic stability.
China
A key player in global commerce whose trade policies directly influence market risk sentiment.
The details
Market participants initiated selective buying of large-cap counters following a recent index pullback. Futures contracts tracked movements in the underlying cash market, with gains recorded across September, October, December 2026, and March 2027 contracts. The uptick reflects a broader shift toward risk-on sentiment as traders react to the reduced probability of near-term trade conflict.
Timeline
September 2026 futures gained 18.5 points.
October 2026 futures gained 12.5 points.
December 2026 futures added 14.5 points.
March 2027 futures gained 12.5 points.
Money Landscape
This development follows a pattern of periodic tariff mitigation efforts used to manage market volatility between the world's two largest economies. It marks a temporary departure from the period of uncertainty that pushed the index to its year-to-date low earlier this year.
The easing of trade tensions can stabilize international equity holdings by reducing volatility driven by geopolitical risk. Investors should review their portfolio exposure to large-cap stocks with a qualified financial professional to ensure their risk tolerance aligns with current market movements.
The takeaway
The two-month trade truce extension has helped stabilize sentiment and encouraged a rebound from recent market lows. Investors should monitor ongoing trade negotiation updates, as these shifts can create rapid changes in the risk appetite of institutional buyers.
Further reading
For more insight into how global trade developments influence indices, explore our Stock Markets coverage.
Source note: This article includes information reported by NST Online.
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