World stock markets mainly rise on China trade report

World stock markets mostly rose on Wednesday on reports of progress in trade talks between Washington and Beijing, ahead of a crucial Group of Seven summit.

"Sentiment is positive in Europe as trade talks between the US and China appear to be making progress," said CMC Markets UK analyst David Madden.

"President (Donald) Trump likes to play hard ball and it seems his tactic is working."

Italian equities however bucked the trend in Europe, posting modest losses on stubborn worries about the nation's newly-formed eurosceptic government led by political novice Giuseppe Conte.

G7 leaders will descend on Quebec this Friday and Saturday for a summit dominated by world trade after Trump slapped Canada, Mexico and the European Union with steel and aluminium tariffs.

The move was condemned by Washington's allies, with Mexico on Tuesday announcing measures on a range of US goods from pork to bourbon, just as it holds trilateral talks on a long-standing deal with Canada and the US.

On Wednesday, the EU said a raft of retaliatory tariffs, including on whiskey and motorcycles, would be ready as early as July.

'Carrot and stick'

Bloomberg News reported that China had offered to ramp up purchases of various US goods during talks this week, while Washington would ease US buying restrictions on Chinese telecom-equipment giant ZTE.

"The president is expected to meet with his advisers on whether to move forward with this proposal or not. It has the ring of truth around it given the Chinese said the other day that all bets are off the table if the US imposes the tariffs," said Greg McKenna, market strategist at AxiTrader.

"They've thus offered both the carrot and the stick."

On currency markets, the dollar steadied after last week's strong jobs report and expectations the Federal Reserve will lift interest rates next week.

And the euro was also enjoying attention again after last week's sell-off fuelled by political turmoil in Italy and Spain. Dealers are also keeping watch on a European Central Bank meeting next week.

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