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Canada’s main stock index opened higher on Tuesday as energy stocks gained after crude prices shot up and Chinese President Xi Jinping’s promise to cut import tariffs diffused escalating trade war worries.

The Toronto Stock Exchange’s S&P/TSX Composite Index was up 104.64 points, or 0.69 per cent, to 15,332.34.

Wall Street also opened higher on Tuesday, led by technology stocks.

The Dow Jones Industrial Average rose 397.78 points, or 1.66 per cent, to 24,376.88, the S&P 500 gained 36.04 points, or 1.38 per cent, to 2,649.2 and the Nasdaq Composite added 110.70 points, or 1.59 per cent, to 7,061.05.

In his first public comments since the trade dispute with the Trump administration started, Jinping vowed to open the country’s economy and said China would raise the foreign ownership limit in automobile, shipbuilding and aircraft sectors “as soon as possible”.

His comments buoyed global markets, which have been under pressure as China and the United States threatened each other with billion in tariffs and investors feared that protectionist measures would hit global economic growth.

Energy stocks gained as oil broke above $70 a barrel on easing trade war fears between the world’s two largest economies.

“The expectation was this could have gone one of two ways: he could have been aggressive about U.S. tariffs or been conciliatory and it feels like he’s more conciliatory,” said Art Hogan, chief market strategist at Wunderlich Securities in New York.

Shares of major U.S. automakers such as General Motors , Ford, Fiat Chrysler and Tesla were up at least 2 per cent in early trading following Xi’s comments.

U.S. stocks will face a major test in coming weeks as first-quarter earnings pour in. Big banks such as JPMorgan Chase , Citigroup and Wells Fargo will kick off the earnings season with their results on Friday.

Analysts expect quarterly profits for S&P 500 companies to rise 18.5 per cent from a year ago, which would be the biggest gain in seven years, according to Thomson Reuters I/B/E/S.

The so-called FANG stocks - Facebook Inc, , Netflix Inc and Alphabet Inc’s Google - were up ahead of Facebook CEO Mark Zuckerberg’s testimony before U.S. lawmakers on Tuesday and Wednesday.

The CEO is expected to strike a conciliatory tone in an attempt to blunt possible regulatory fallout from the privacy scandal engulfing his social network.

Russian assets extended Monday’s slide as investors digested the new round of U.S. sanctions targeting the country’s tycoons. The rouble plunged more than 4 per cent against the dollar to its lowest since late-2016.

European markets followed Asia with solid gains. Germany’s DAX rose 0.8 per cent, France’s CAC 40 0.51 percent and Britain’s FTSE 100 0.59 per cent.

The MSCI World Index rose 0.34 per cent.

“In the current environment markets are grabbing at the slightest hint. Today’s message from Xi contained nothing really new but it seemed like a conciliatory tone and so the market is just grabbing at that,” said Peter Garnry, head of equity strategy at Saxo Bank in Copenhagen.

“It goes back to the fact that there is still uncertainty on trade wars and even if we get a slight indication that it won’t be the worst case scenario, the market reacts positively,” he said, while predicting ongoing trade tensions throughout 2018.

Oil markets rose sharply on hopes that the trade dispute may be resolved without greater damage to the global economy. Brent crude futures climbed more 2 per cent to $70.12.

After trading flat for most of the day, the euro surged when European Central Bank policymaker Ewald Nowotny told Reuters that the central bank could stagger the process of raising euro zone interest rates by first lifting its sub-zero deposit rate back toward positive territory.

The euro rose 0.4 per cent to $1.2378 and left the dollar down across most major currencies aside from the Japanese yen.

The yen, which traditionally rises in times of market stress, fell versus both the dollar and euro. The dollar rose to as high as 107.245 before giving up some of those gains.

Safe haven bond prices including 10-year Treasuries initially dropped as risk appetite recovered.

Gold rose 0.2 per cent.

The Australian dollar, which has fallen in recent weeks because of the economy’s exposure to global trade flows, gained against the dollar, as did Asian currencies including the Chinese yuan

“Xi explicitly did not continue the trade war rhetoric so this is going to be risk-friendly and the market will be relieved,” said Kit Juckes, a macro strategist at Societe Generale.

Russian financial markets sold off sharply.

The rouble tumbled 4.2 per cent, bringing its losses against the dollar since last Friday to around 10 percent.

Rouble-denominated shares rose 0.8 per cent, bouncing off multi-month lows hit on Monday when the Moscow bourse dropped 8.3 per cent

The shares of Rusal, the aluminum giant, which, with its boss Oleg Deripaska, was highlighted prominently in the sanctions, fell a further 7.5 per cent in Hong Kong after slumping 50 per cent on Monday.

Its dollar bonds maturing 2022 were trading at record lows around 52 cents, having lost half their value since the sanctions were announced.

“It is very serious, it’s very rare that you see a country literally force a company from another country towards bankruptcy. When you are shut out of dollar funding markets, a lot of your business will just stop working,” Saxo Bank’s Garnry said, adding that Russia’s smaller role in global financial markets would limit the wider fallout.

The MSCI Emerging markets index was up 0.63 per cent as other larger markets outside of Russia rallied.

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