Shares in Asia have soared after Donald Trump said he would delay an increase in tariffs on Chinese goods, citing “substantial progress” in trade talks with China over the weekend.

The US president said on Sunday night that he would hold a summit meeting with the Chinese president Xi Jinping at his Mar-a-Lago estate in Florida to conclude an agreement, assuming both sides made additional progress.

I am pleased to report that the U.S. has made substantial progress in our trade talks with China on important structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues. As a result of these very...... — Donald J. Trump (@realDonaldTrump) February 24, 2019

Trump tweeted on Sunday night that progress had been made on “structural issues including intellectual property protection, technology transfer, agriculture, services, currency, and many other issues” in the talks in Washington.

He ended by saying that it had been a “great weekend” for the US and China.

....productive talks, I will be delaying the U.S. increase in tariffs now scheduled for March 1. Assuming both sides make additional progress, we will be planning a Summit for President Xi and myself, at Mar-a-Lago, to conclude an agreement. A very good weekend for U.S. & China! — Donald J. Trump (@realDonaldTrump) February 24, 2019

Trump had planned to raise tariffs to 25% from 10% on $200bn worth of Chinese imports into the United States if an agreement between the world’s two largest economies were not reached by Friday.

His remarks sent shares in Asia to their highest point for five months on Monday as optimism mounted about an agreement.

The Shanghai market saw the most notable gains, surging 3.5% to heights not seen since last June and taking this year’s gains to more than 20%. The Nikkei in Tokyo was 0.5% higher while the Kospi in Seoul rose 0.45%. The Australian dollar, a proxy for Chinese trade, also climbed on the news.

“The high frequency engagement between Beijing and Washington at a senior level implies that both sides are looking for some form of settlement,” said Tai Hui, chief market strategist Asia Pacific at JP Morgan Asset Management.

China’s official Xinhua news agency echoed Trump’s comments and said the two sides “came a step closer to realising the important consensus reached” by Trump and Xi Jinping when they agreed to a trade war truce in December. The delegations agreed to “carry out follow-ups in accordance with the instructions of the two heads of state”.

The delay in tariffs was the clearest sign yet of a breakthrough the two sides have sought since calling a 90-day truce in a trade war last year. It will likely be cheered by markets as a sign of an end to the year-long dispute that has disrupted commerce worth hundreds of billions of dollars of goods and slowed global economic growth.

During talks that extended into the weekend, US and Chinese negotiators were discussing on Sunday the issue of how to enforce a potential deal after making progress on other structural issues, according to a source familiar with the talks.

The two sides were discussing tariffs on Sunday as well as commodities, the source said.

Talks were extended into the weekend after negotiators produced a deal on currency during negotiations last week.

Officials were seeking to iron out differences on changes to China’s treatment of state-owned enterprises, subsidies, forced technology transfers and cyber theft.

The two sides have been negotiating an enforcement mechanism. Washington wants a strong mechanism to ensure that Chinese reform commitments were followed through to completion, while Beijing insisted on what it called a “fair and objective” process.

Reuters and AFP contributed to this report.