(Bloomberg) -- Monday’s moderate market reaction to progress in US-China trade talks at least gave investors a roadmap for how a significant breakthrough might play out.

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Though short on detail, the declaration from President Donald Trump’s adminstration of “substantial progress” was enough to cause a shift toward assets linked to US and Chinese growth and away from havens.

Some strategists touted the benefits of a sentiment boost, even as others cautioned that the lack of specifics kept uncertainty elevated.

US stock futures outperformed European equity contracts and Asian shares, while the yen and Swiss franc slipped against the dollar with Treasuries. China currency proxies the Australian and New Zealand dollars strengthened alongside the yuan as the euro retreated.

“The knee-jerk market reaction to weekend developments has been a positive one, with equity futures rallying across the board, Treasuries selling-off a touch, and the dollar gaining ground against most peers,” said Michael Brown, a strategist at Pepperstone Group. “As the adage goes, though, the devil will be in the detail here.”

Investors entered the weekend seeking signs of a detente in the trade war that’s been the biggest driver of markets this year. The fear is that unless reversed, tit-for-tat tariffs risks dealing a stagflationary blow to the US and world economies by driving them into recession and at the same time boosting inflation.

Markets have erased much of the damage from Trump’s so-called Liberation Day tariff announcements as the president pulled back on some of his protectionist pledges, but investors are nevertheless likely to stay wary of staking large bets on encouraging comments before any concrete plans are announced to reduce levies, especially those between the world’s two largest economies.

Positive comments about the talks are “a relief, but not enough to get back into risky assets,” said Rajeev De Mello, a global macro portfolio manager at Gama Asset Management SA. “Firm details that the tariffs rates are coming down to a 40% or lower level” are what’s needed to increase broad equity exposure, he said.

Wall Street ended Friday on a cautious note, with stocks and bonds fluctuating, after some optimism in the preceding days that the talks in Switzerland would at least narrow differences between Washington and Beijing.

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“The de-escalation of trade, economic and geopolitical tensions could give market risk sentiment a boost,” said Valentin Marinov, head of G-10 FX research and strategy at Credit Agricole. “The latest developments could become a boon for risk-correlated assets and currencies and a blow to safe-haven currencies like the yen, Swiss franc and even the euro.”

Risk assets also benefited from the ceasefire between India and Pakistan, as well as signs the leaders of Russia and Ukraine may meet this week.

Rounds of retaliation have raised US tariffs on imports from China to 145%, while the Chinese have put in place a 125% duty on US goods. Two-way annual trade between both countries is around $700 billion, and China has an estimated $1.4 trillion of portfolio investments in the US.

The US side had set a target of reducing tariffs below 60% as a first step that they feel China may be prepared to match, people familiar with the conversations said before the weekend. Trump said on social media on Friday that an 80% levy “seems right!”

The S&P 500 Index has risen back to around where it was prior to Trump’s announcement of reciprocal tariffs in early April, a declaration which triggered the worst day for equities since 2020.

A week later, Trump paused the steepest of the tariffs on most countries other than China, sparking a rally in the S&P 500 that was the best since the 2008 financial crisis. A trade deal struck with the UK last week also helped lift confidence that pacts were possible although the details disappointed.

Trade pressures are already starting to hit US businesses, with companies from United Parcel Service Inc. to Ford Motor Co. to Mattel Inc. withdrawing guidance, citing tariff uncertainty that’s getting too hard to navigate. The average member of the S&P 500 made 6.1% of its revenue from selling goods in China or to Chinese companies in 2024, according to an analysis from Bloomberg Intelligence.

The dollar extended its gain in early trading Monday after the best weekly rise since late March last week, but is still suffering its worst start to the year in at least two decades with the Bloomberg Dollar Spot Index down 6% so far.

Since April 2, speculative traders — including hedge funds and asset managers — have build an increasingly bearish position on the dollar, according to data from the Commodity Futures Trading Commission. They hold some $17 billion worth of wagers tied to bets that the greenback will weaken, the latest data show.

Chinese shares climbed on Monday after investors were cautious heading into the weekend. The region’s CSI 300 Index has come close to recouping all its losses since Chinese goods were targeted with US tariffs above 100% early last month. Strategists at Goldman Sachs Inc. last week raised their 12-month index targets for MSCI China and CSI 300 to 78 and 4,400, implying about 7% and 14% returns from the current levels.

Despite their traditional safe-haven status, Treasuries have slipped since early April. The yield on 30-year bonds climbed to 4.85% on Monday, from a recent low of 4.41% in early April.

--With assistance from Elena Popina and Michael G. Wilson.

(Updates throughout. An earlier version corrected the spelling of Switzerland.)

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