In European Equity Markets indices reversed course to close higher Tuesday after China’s State Council announced that it is considering relaxing and removing restrictions on auto purchases as part of a broad move to boost consumption. The pan-European Stoxx 600 finished 0.5% higher, with auto stocks outperforming. At the other end of the Stoxx 600, Sweden’s Dometic Group fell 7.5% as a downward trend in U.S. leisure vehicle shipments continued, according to Reuters. Meanwhile, Rockwool International fell 4.6% on target price cuts from Barclays and Morgan Stanley.

In Currency Markets the British pound rose on Tuesday as opposition parties vowed to try and pass a law to prevent a no-deal Brexit at the end of October, encouraging traders to buy sterling even though most fear the country is headed for a disorderly exit from the EU. The pound extended its earlier gains after the statement. Sterling rose more than 0.7% on the day to hit as high as $1.2310, its strongest since July 29, before giving up some of those gains to trade at $1.2259. The British currency also hit a one-month high versus the euro at 90.17 pence, before steadying at 90.58 pence per euro

In Commodities Markets oil prices rose more than 1% on Tuesday after U.S. President Donald Trump predicted a trade deal with China following positive comments by Beijing, calming concerns raised by an earlier round of tit-for-tat tariff hikes. Brent crude was up 61 cents, or 1.04%, at $59.31 a barrel. U.S. West Texas Intermediate crude futures were up 70 cents, or 1.3%, at $54.34. Trump said on Monday that he believed China was sincere about wanting to reach a deal, while Chinese Vice Premier Liu He said China was willing to resolve the dispute through “calm” negotiations.

In US Equity Markets indexes rose for the second straight session on Tuesday, supported by broad-based gains as investors pinned their hopes on a resolution to the protracted U.S.-China trade dispute despite mixed signals from both sides. The S&P 500 gained 0.51%, to 2,893.11 and the Nasdaq Composite added 0.63%, to 7,903.20. Among other stocks, Philip Morris International Inc fell 5.7%, to the bottom of the S&P 500, after the tobacco maker said it was in talks with peer Altria Group Inc to combine in an all-stock merger of equals. Altria’s shares jumped 8.6%.

In Bond Markets Italian government bonds rallied on Tuesday, pushing 10-year yields to fresh three-year lows on signs of progress in talks between the Democratic Party (PD) and anti-establishment 5-Star Movement to form a new government. In a day of volatile trading, Italian bond yields were driven by the latest headlines on the coalition talks. Italy’s 10-year bond fell 21 basis points on the day to 1.124%, its lowest in three years. It was on track for its biggest daily fall since early July.