Chinese ETFs and ADRs jumped in premarket trading amid hopes of a de-escalation in US-China trade tensions after US President Donald Trump hinted at lower tariffs on Chinese goods and said he had no plans to fire the Federal Reserve chair.

XPeng rose 8%; YINN rose 5%; PDD, Alibaba rose 4%; Chagee up 3%; NIO, JD.com rose 2%.

The softened rhetoric was interpreted as a potential shift in strategy. In the past, Trump and Powell had clashed over the direction of interest rates with the president advocating for lower rates to boost economic growth, while the latter held back, wary that reduced borrowing costs might reignite inflation pressures, especially in the face of rising tariffs.

“The risk sentiment is better today on the headlines,” said Xing Zhaopeng, senior China strategist at ANZ. “We expect a policy pivot by the US administration in the coming months. Market is pricing in quick trade deals and tax cuts.”

Earlier on Tuesday, US Treasury Secretary Scott Bessent told investors in a closed-door meeting that the tariff stand-off with China was unsustainable by both sides and that the world’s two largest economies would have to find ways to de-escalate.

That de-escalation would come soon, he added.

“De-escalation is coming – and not in some distant, abstract timeline,” Stephen Innes, managing partner at SPI Asset Management, said in a note after Bessent’s remarks. “His stance reframed the entire narrative: this isn’t about decoupling, it’s about managing a strategic rivalry without nuking the global supply chain in the process.”

Chinese e-commerce platforms to end refund-without-returns amid weak economy

Chinese authorities have asked e-commerce platform operators to stop insisting on merchants refunding customers without requiring the return of goods, to alleviate financial pressure on merchants, two people familiar with the matter said.

The government met operators including PDD Holdings and concluded the practice must end by July, from which point only merchants will be able to initiate a refund, the people said, without specifying dates.

The aim is to prevent merchants' situation becoming tenuous during times of economic slowdown, said one of the people, who declined to be identified because the information is not public.

PDD and peer JD.com declined to comment. Alibaba Group and the State Administration for Market Regulation did not respond to requests for comment.

In July, hundreds of people gathered at an office of PDD platform Temu in southern China to protest against its refund policy. Authorities including the market regulator and commerce ministry subsequently ordered PDD to revise the policy.

This year, government bodies including the market regulator and the National Development and Reform Commission have increased criticism of what they dub "involution-style" competition. In March, during the annual parliamentary session, the phrase "comprehensive rectification of 'involution-style' competition" was incorporated into the Government Work Report.

The refund-without-returns policy was designed to benefit both buyers and sellers for some types of order. PDD began to expand the policy in 2021, prompting rivals to follow suit.

Merchants of goods as varied as clothes and household appliances have reported the policy as detrimental to their bottom line as they risk losing both money and goods.