In This Article:
* Shares climb after Trump scraps Mexico tariffs
* European markets move higher, U.S. stocks futures up
* Weak U.S. payrolls data bolsters Fed rate cut expectations
* Yuan at late-2018 lows; China's May imports disappoint
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
By Tom Arnold
LONDON, June 10 (Reuters) - European shares followed Asian stocks higher on Monday after the United States shelved plans to impose tariffs on Mexico and as investors anticipated lower U.S. interest rates when the Federal Reserve meets next week on the back of poor jobs data.
Investors had fretted that opening up another trade conflict, while still battling with China, could push the United States and other major economies into recession. The Mexican peso rallied more than 2% on Monday.
But in China, the yuan slipped to its weakest this year after the country's imports fell the most in nearly three years and as talks to end the Sino-U.S. dispute remained deadlocked.
The pan-European STOXX 600 gained 0.3% in early trade, with Britain's FTSE 100 up 0.6%, while S&P500 mini futures were up 0.3% after rising as much as 0.8%.
The 10-year U.S. Treasuries yield was at 2.1345 percent , after hitting a 21-month low of 2.053 percent on Friday on soft U.S. jobs data.
In Asia, Tokyo's Nikkei closed up 1.2%, while MSCI's index of Asia-Pacific shares outside Japan rose as much as 1%.
"Markets are blowing small celebratory bubbles," said Deutsche Bank strategist Jim Reid.
"There will be relief that the tariffs have been avoided and perhaps some might believe it shows Trump's propensity to strike deals after brinkmanship. As such there may be those thinking that a similar thing might happen with the China trade situation."
CARS MOVE AHEAD
The European auto sector was boosted by signs that Fiat Chrysler Automobiles NV and Renault SA were looking for ways to revive their collapsed merger plan and secure the approval of Nissan Motor Co. Fiat Chrysler jumped 3%, while Renault's shares were up 1%.
In London, Thomas Cook's shares rose 20% after a report that Hong Kong-listed Fosun Tourism was in talks to buy its tour operating business as the British group faces breakup after issuing three profit warnings in the past year.
Investors were also digesting Chinese data showing imports in May contracted 8.5% from a year earlier, a much worse than expected outcome that signalled weak domestic consumption. Exports, however, unexpectedly rose 1.1% last month, though many suspect the uptick is linked to front-loading of shipments by firms to avoid higher U.S. tariffs.