Global equities rebounded on Wednesday, buoyed by dovish comments from Federal Reserve Chair Jerome Powell and upbeat U.S. bank earnings, even as U.S.-China trade tensions kept risk appetite in check.

Powell signaled the Fed may soon end its balance-sheet reduction and left the door open to further rate cuts, reinforcing expectations for two more moves this year. The remarks helped lift sentiment after recent volatility sparked by escalating trade frictions.

The MSCI Asia-Pacific index rose 1.4%, Japan’s Nikkei gained 1.5%, and Hong Kong’s Hang Seng climbed 1.2%, while China’s CSI300 slipped slightly. Nasdaq and S&P 500 futures edged higher, extending Wall Street’s recovery on strong bank results and an IMF upgrade to 2025 global growth.

Still, caution persisted after President Trump threatened new trade measures against China, including a potential cooking oil embargo, following Beijing’s expanded export controls on rare earths.

In currencies, the dollar weakened as rate-cut bets deepened, while gold extended record gains to around $4,180 an ounce. Oil prices eased modestly, with Brent crude near $62 a barre