After two days of high-profile, closely watched talks in London, the two sides said they had set up a framework to move towards a pact, following negotiations in Geneva last month that saw them slash tit-for-tat levies.
The news provided some much-needed relief to markets after US President Donald Trump accused Beijing of violating that deal. The latest round of talks followed a phone call between Trump and his Chinese counterpart Xi Jinping on Thursday.
As well as tariffs, a key issue in the discussions was China's export of earth minerals and magnets used in a range of things including smartphones and electric vehicle batteries, while Beijing was keen to see an easing of restrictions on its access to tech goods.
US Commerce Secretary Howard Lutnick said he was upbeat that concerns over rare earths "will be resolved" eventually, as the agreement is implemented.
Xi and Trump must approve the framework first.
"We're moving as quickly as we can," US Trade Representative Jamieson Greer told reporters. "We would very much like to find an agreement that makes sense for both countries," he added.
"We feel positive about engaging with the Chinese."
Speaking separately to reporters, China International Trade Representative Li Chenggang expressed hope that progress made in London would help to boost trust on both sides.
The deal, which was reached late Tuesday, boosted Asian markets with Hong Kong and Shanghai among the best performers, while Tokyo, Sydney, Seoul, Wellington, Taipei and Manila were also up.
However, analysts said investors would be keen to get a closer look at the details of the agreement.
"The US-China trade circus wrapped with what can only be described as a diplomatic tautology," said Stephen Innes at SPI Asset Management.
He called it "a late-night announcement that both sides have 'agreed in principle on a framework to implement the Geneva consensus' -- a consensus that was... already agreed upon weeks ago".
And he warned that markets could run out of steam if nothing concrete came through.
"If the next headline doesn't come with something tangible, such as cargo ships loaded with rare earths or an actual rollback of tariffs, expect risk assets to start demanding more photo opportunities," he wrote.
"Until then, this rally relies on faith."
And Saxo chief investment strategist Charu Chanana said before the deal was announced that while there was some hope for the talks "the era of easy wins -- tariff pauses and minor concessions -- is over".
"What's left are deeper, more entrenched challenges: tech restrictions, rare earth supply chains, student visas, and national security-linked concerns. These are strategic disputes, unlikely to be resolved in a few rounds of meetings."
Still, she did say that "trade uncertainty has clearly faded since the peak chaos of early April", when Trump unleashed a tariff blitz that hammered worldwide stock and bond markets.
Tuesday's news also overshadowed the World Bank's slashing of its 2025 forecast for global economic growth to 2.3 percent, from the 2.7 percent predicted in January, citing trade tensions and policy uncertainty.
It also said the US economy would expand 1.4 percent this year, half of its 2024 expansion.
- Key figures at around 0230 GMT -
Tokyo - Nikkei 225: UP 0.5 percent at 38,385.37 (break)
Hong Kong - Hang Seng Index: UP 0.7 percent at 24,327.51
Shanghai - Composite: UP 0.6 percent at 3,403.56
Euro/dollar: DOWN at $1.1413 from $1.1426 on Tuesday
Pound/dollar: DOWN at $1.3481 from $1.3501
Dollar/yen: UP at 145.03 yen 144.88 yen
Euro/pound: UP 84.66 pence from 84.61 pence
West Texas Intermediate: DOWN 0.2 percent at $64.86 per barrel
Brent North Sea Crude: DOWN 0.2 percent at $66.72 per barrel
New York - Dow: UP 0.3 percent at 42,866.87 (close)
London - FTSE 100: UP 0.2 percent at 8,853.08 (close)
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