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A truce between U.S. and Chinese leaders on trade tariffs provided boosted global markets on Monday, fueling a nearly one percent surge on world stocks and pushing emerging currencies higher against the dollar.

The gains came after China and the United States agreed at the weekend to halt additional tariffs on each other. The deal prevents their trade war escalating as the two sides try to bridge differences with fresh talks aimed at reaching a deal within 90 days.

President Donald Trump also said "China has agreed to reduce and remove tariffs on cars coming into China from the U.S. Currently the tariff is 40 percent." That helped boost European autos more than 4 percent.

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"We have a deal. That's wonderful news for global financial markets and signaling the start for a year-end rally in risky assets," said Bernd Berg global macro strategist at Woodman Asset Management.

"We are going to see a rally in emerging market and U.S equities, EM currencies and China-related assets like Australia. I expect the rally to last until year-end."

Asian shares kicked off the gains, with Chinese mainland markets rising more than 2.5 percent while Japan's Nikkei gained as much as 1.3 percent to a six-week high.

The greenback has already come under some pressure from the recent subtle shift in the Federal Reserve's policy communication to a slightly more dovish stance. Comments by Federal Reserve Chair Jerome Powell were interpreted by markets as hinting at a slower pace of rate hikes.

Powell was scheduled to testify on Wednesday to a congressional Joint Economic Committee but his hearing is expected to be postponed to Thursday because major exchanges will be closed on Wednesday in honor of former President George H.W. Bush, who died on Saturday.

Florian Hense, economist at Berenberg, said the market rally would not bring a return to a more hawkish Fed stance.

"We would need to see some rebound in economic activity to lift expectations of more rate hikes," he said.

Elsewhere, oil soared more than five percent, a positive start after it had posted its weakest month in more than 10 years in November, losing more than 20 percent as global supply outstripped demand.