Markets rallied after US treasury secretary Scott Bessent said the threat of the US president imposing an additional 100% tariff on Chinese goods was “effectively off the table” following weekend negotiations in Malaysia.

“The tariffs will be averted,” Bessent told ABC News on Sunday, adding that China agreed to delay rare earth export controls and make “substantial” soybean purchases.

Chinese vice premier He Lifeng said the two sides reached a “preliminary consensus” on tariffs, export controls and fentanyl cooperation, describing the talks as “candid, in-depth and constructive”.

The progress paves the way for Trump and Xi to meet Thursday in South Korea on the sidelines of the Asia-Pacific Economic Cooperation summit, their first face-to-face meeting since Trump returned to office.

Asian shares rose in early trade, with stocks in Japan and South Korea jumping about 2%, and each breaching milestones.

Hong Kong, Shanghai and Taipei also opened on the front foot.

The positive sentiment follows a strong finish on Wall Street Friday, after benign US inflation data set the stage for another Federal Reserve interest rate cut.

Trump expressed confidence about reaching a comprehensive agreement with Beijing. “They want to make a deal and we want to make a deal,” he told reporters Sunday in Kuala Lumpur.

The Republican president is on a five-day Asia tour that includes stops in Malaysia, Japan and South Korea, with trade deals topping the agenda at every destination.

Futures for US copper surged on the trade deal optimism, bolstering the outlook for global demand.

The breakthrough came after months of escalating tensions, with Trump threatening the massive tariff hike in response to China’s October expansion of rare earth export controls – a move Washington called “economic coercion”.

Under the framework deal, China would defer its rare earth restrictions “for a year while they re-examine it”, Bessent said.