Global shares see modest gains as optimism over China-US trade truce fades

World shares posted modest gains on Tuesday as the initial excitement over the 90-day trade war truce between the United States and China began to wane. Investors, while still optimistic, were sobered by uncertainties about the long-term impact of the deal and potential shifts in US President Donald Trump's policies.The futures for the S&P 500 slipped 0.4% and the Dow Jones Industrial Average fell 0.2%. This came after a surge in stock prices on Monday, when both the US and China agreed to cut tariffs on each other’s goods for 90 days. US tariffs on Chinese goods will drop from as high as 145% to 30%, while China’s tariffs on US goods will fall from 125% to 10%. The deal provides time for further negotiations following talks in Geneva, Switzerland, which both sides said had yielded "substantial progress."Stephen Innes of SPI Asset Management noted that while the deal’s outcome surpassed expectations and reassured investors, the underlying issues between the two countries remain. "Make no mistake, this was highly stage-managed diplomacy. But the optics are good and the implications real. It signals that even this administration recognizes the economic drag of unrelenting tariffs," he said.Despite the temporary thaw in trade tensions, significant challenges remain for both countries, and many nations have yet to secure their own tariff-relieving agreements.European markets saw modest gains, with Germany's DAX up 0.1% to 23,588.06, the CAC 40 in Paris gaining 0.2% to 7,863.60, and the UK's FTSE 100 climbing less than 0.1% to 8,609.27, as reported news agency AP.In contrast, Beijing’s frustrations with the trade war remained clear. Chinese President Xi Jinping, speaking to officials from China and Latin America on Tuesday, reiterated that "nobody wins a trade war" and warned that "bullying or hegemonism only leads to self-isolation."In Japan, Tokyo's Nikkei 225 jumped 1.4% to 38,183.26, fuelled by a surge in the value of the US dollar against the Japanese yen. Automakers were among the top gainers, with Toyota Motor Corp up 3.5% and Suzuki Motor Corp rising 2.4%. Nissan Motor Co added 3% ahead of its announcement about restructuring plans, including cutting 20,000 jobs and reporting a loss of 670.9 billion yen ($4.5 billion) for the last fiscal year.South Korea’s Kospi remained nearly unchanged at 2,608.42, while Hong Kong’s Hang Seng, which had surged 3% on Monday, fell 1.9% to 23,108.27 amid heavy selling of technology stocks.The Shanghai Composite index edged up by 0.2% to 3,374.87, and Taiwan’s Taiex gained 1%. India’s Sensex, however, dropped 1.5%. In Australia, the S&P/ASX 200 climbed 0.4% to 8,276.00.On Wall Street, the tariff agreement between the US and China fuelled a sharp rally on Monday. The S&P 500 soared 3.3%, moving within 5% of its all-time high from February. The Dow Jones Industrial Average rose 2.8%, and the Nasdaq composite surged 4.3%.Meanwhile, oil prices retreated after a strong rally on Monday. US benchmark crude oil gave up 15 cents to $61.80 per barrel, while Brent crude, the international standard, shed 18 cents to $64.78 per barrel.The US dollar, which had strengthened on Monday against major currencies, saw mixed movement on Tuesday. It traded at 147.93 Japanese yen, down from 148.47 yen, but gained against the Euro, climbing to $1.1104 from $1.1088.Economic reports scheduled for later this week, including those on US inflation and consumer sentiment, may provide further insights into how much uncertainty surrounding the tariffs is affecting the economy.