And the European Central Bank has held interest rates steady.
Happy Friday and welcome to your morning wrap of the latest business and political headlines from around the world.
First up, US President Donald Trump said overnight he has agreed with his Chinese counterpart Xi Jinping to trim tariffs on China in exchange for Beijing cracking down on the illicit fentanyl trade, resuming US soybean imports and maintaining the flow of rare earth exports, Reuters reported.
Trump said the tariffs on Chinese imports would be lowered to 47% from 57%, by halving the 20% levy related to the trade of fentanyl precursor drugs.
According to Beijing officials, the deal also included a US pledge to delay restrictions on Chinese firms which prevent them from receiving US technology if they are part-owned by a sanctioned company.
"It was an amazing meeting," Trump told reporters aboard Air Force One shortly after he left South Korea, ranking the talks a "12 out of 10".
The summit, which was Trump and XI's first face-to-face meeting since 2019, has had a muted effect on global stock markets, which had hit records ahead of the meeting on hopes of a breakthrough in the trade war between the two countries.
To Brazil now, where the death toll from a major police raid targeting a drug trafficking gang in Rio de Janeiro has risen to at least 121 people, the Associated Press reported.
The operation began earlier this week in two of the city’s favelas, sparking intense gun battles. An unknown number of people were wounded. Among the dead were four police officers.
Human rights groups have called for investigations into the deaths, describing the operation as one of the most violent in Brazil’s recent history. It has sparked protests and accusations of excessive force, as well as calls for the resignation of the city’s governor.
Police said the raid followed a year-long investigation into the Red Command criminal gang, which originated in Rio’s prisons and controls drug trafficking in some of the city’s low-income areas.
Turning to Wall Street, tech giant Meta’s shares have plunged 10% as investor scepticism about the payoff from the company’s aggressive spending plans in AI overshadowed strong results, CNBC reported.
Meta lifted the midpoint of capital expenditure guidance to $71b from $68b, with the company’s chief executive, Mark Zuckerberg, defending its capital investment plans during the earnings call.
“It’s pretty early, but I think we’re seeing the returns in the core business,” he said. “That’s giving us a lot of confidence that we should be investing a lot more, and we want to make sure that we’re not underinvesting.”
Meta’s third-quarter adjusted earnings of $7.25 per share on US$51.25b of revenue were ahead of Wall Street’s estimates. Sales were up 26% on the same period a year ago, while the company reported a $15.9b tax charge from the rollout of Trump’s One Big Beautiful Act.
Mark Zuckerberg.
To the Netherlands now, where the Dutch general election is on a knife-edge, the BBC reported.
Rob Jetten’s centrist-liberal party, D66, is in a neck-and-neck race with anti-Islam populist Geert Wilders, according to almost complete results, which show their respective parties were heading for 26 seats each in the 150-member parliament.
However, the last preliminary results from the capital Amsterdam put the liberals ahead by 15,000 votes.
Jetten’s and Wilders’ parties were below 17% of the national vote, and three other parties were not far behind, including the conservative-liberal VVD on 22 seats, followed by the left-wing GreenLeft-Labour party on 22 and the Christian Democrats on 18.
Wilders led the polls throughout the election campaign, but after he pulled the plug on his own coalition in June in a row over asylum and migration, all the mainstream political leaders said they would not work with him again.
He has admitted he has little hope of forming a government, but told his followers on social media that if his party topped the vote, he should have the first try.
Only a few weeks ago, polls put D66 on just 12 seats, but the photogenic Jettens capitalised on polished performances in a succession of TV debates and interviews to lift both his and his party's profile.
Geert Wilders.
Staying in Europe, the European Central Bank has kept interest rates unchanged at 2% for the third meeting in a row as economic risks recede, Reuters reported.
The ECB cut rates by 200 basis points in the year to June but has sat on the sidelines since.
"From a monetary policy point of view, we are in a good place," ECB President Christine Lagarde told a press conference. "Is it a fixed good place? No. But we will do whatever is needed to make sure that we stay in a good place."
While growth across the 20 countries that use the euro is not spectacular, Lagarde said she would not complain about its 0.2% growth in the third quarter, which beat both market and ECB projections.
Financial investors did not materially alter their view on the policy outlook and still see a 40% to 50% chance of one last rate cut by the middle of next year.
Christine Lagarde.
Finally, Wall Street fell overnight as investors digested a batch of Big Tech earnings and Trump’s meeting with Xi Jinping concluded.
The S&P 500 was down 0.5%, while the tech-heavy Nasdaq fell 1%. The Dow Jones Industrial Average rose 0.3%.
The likes of Alphabet, Meta and Microsoft reported quarterly results after hours yesterday, and while Alphabet’s shares popped 4%, Meta and Microsoft tumbled 10% and 2% respectively amid each company’s increased spending outlooks.
The sell-down was “probably a natural, healthy thing,” Argent Capital portfolio manager Jed Ellerbroek told CNBC. However, he said “all signs remain that AI infrastructure spending is extremely strong”.
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