Stocks in Asia rose on Monday after U.S. President Donald Trump's announcement last week that tariffs would not be slapped on Mexican goods.
Mainland Chinese stocks were higher on the day, with the Shenzhen component jumping 1.48% to close at 8,711.79 and the Shenzhen composite rising 1.334% to end its trading day at 1,483.23. The Shanghai composite also gained 0.86% to close at 2,852.13.
Official Chinese trade data for May showed the country's exports beating forecasts and imports falling short of expectations, leaving it with an overall trade surplus of $41.65 billion for the month.
May exports in China rose 1.1% as compared to a year earlier against expectations of a 3.8% decline by analysts in a Reuters poll. Imports, which were also expected to fall 3.8%, dropped 8.5% instead.
"Looking forward, we expect only modest sequential export growth as global trade remains tepid, while China's exports outlook will continue to be challenged the renewed escalation of US-China trade tensions – with both sides having raised tariffs on each other's exports again recently," Louis Kuijs, head of Asia economics at Oxford Economics, wrote in a note.
The onshore Chinese yuan touched its lowest point in 2019 following the data release. It last traded at 6.9324 against the dollar, while its offshore counterpart also declined to 6.9489 against the greenback.
The , whose fortunes are often seen to be closely tied to that of China given the two countries' trade relationship, changed hands at $0.6967 following an earlier high of $0.7022.
Japan's Nikkei 225 jumped 1.2% to close at 21,134.42, while the Topix index gained 1.34% to finish its trading day at 1,552.94. Data on Monday showed that Japan's economy grew at a slightly higher annualized rate than initially estimated —2.2% in the January to March period, as compared to economists' median forecast of 2.1% growth in a Reuters poll.
Auto shares in both markets jumped on the news that Trump had withdrawn his tariff threat on Mexican goods. They had initially tumbled when the levies were announced.
Markets in Australia were closed on Monday for a holiday.
Trump announced last Friday that the U.S. and Mexico reached a deal to avoid the implementation of tariffs, originally set to kick in on Monday. In return, he said, Mexico agreed to take "strong measures" to strengthen immigration enforcement.
The latest development comes as the U.S. remains locked in a trade war with China as the two economic powerhouses hit an impasse in negotiations.
U.S. Treasury Secretary Steven Mnuchin, who has been among the lead negotiators involved in trade talks with China, told CNBC on Sunday that Trump will decide on whether to implement more tariffs on China after the American leader meets with Chinese President Xi Jinping later in June.
"We're going to need to see action, and President Trump is going to need to make sure he's clear that we're moving in the right direction to a deal," Mnuchin told CNBC. "The president will make a decision after the meeting."
Trump has previously indicated he expects to plan his next trade moves after the G-20 meeting in Japan.
One investor told CNBC that the markets are "going to wait till that big event."
"Everybody's hopeful they will strike a deal, it's not going to be (an) easy meeting. Quite clearly, there's been a lot of ... rhetoric going on between the Chinese and the U.S., you don't see signs of compromise," Vasu Menon, vice president of group wealth management at Singapore's OCBC Bank, told CNBC's "Squawk Box" on Monday.
Meanwhile, a drastic slowdown for jobs creation in May increased the odds that the U.S. would go on an easier monetary policy. Nonfarm payrolls were up by 75,000 in May — the second time in four months that the figure increased by less than 100,000. Economists surveyed by Dow Jones had been looking for a gain of 180,000.
Concerns over the potential impact of U.S. trade policy and signs of a slowing American economy have raised expectations that the Federal Reserve would slash interest rates.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.802 after declining from levels above 97.6 last week. The traded at 108.64 against the dollar after touching levels below 108.0 last week.
Oil prices were higher in the afternoon of Asian trading hours, with the international benchmark Brent crude futures contract adding 0.3% to $63.48 per barrel and U.S. crude futures rising 0.46% to $54.24 per barrel.
— Reuters, along with CNBC's Fred Imbert and Everett Rosenfeld, contributed to this report.