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US markets have risen across the board, as transatlantic relations between the European Union and the US came back from the brink of a disastrous trade war for both sides.

The S&P 500 index leaped more than half a per cent in the last half-hour of trading, closing at its highest level since the end of January this year. The Dow reversed its earlier losses to rise 172 points.

European Commission president Jean-Claude Juncker led a delegation to pay Donald Trump a visit in Washington, following a series of belligerent moves by the US President. Trump has slapped tariffs of up to 25 per cent on steel and aluminium exports from the EU and threatened to do the same on automotives.

However, tonight both sides said they had agreed to "work together toward zero tariffs, zero non-tariff barriers and zero subsidies on non-auto industrial goods".

Read more: EU 'ready' to discuss reduction of 'all tariffs' with US

This will involve increasing US exports of liquefied natural gas and soybeans to Europe, which Trump claimed was a "big deal".

They also agreed to unify regulatory standards on matters such as intellectual property theft and reform of the World Trade Organisation through the immediate creation of an executive working group. Both parties have promised not to go against the spirit of this agreement, unless either one terminates the negotiations.

In a joint press conference held at the White House after the meeting, Trump said the two had a "very big day" that will launch a phase of a "close friendship" between the EU and US.

Some critics of Trump said the improved sentiment and prospective benefits emerging from his meeting tonight was no different to that proposed in the Transatlantic Trade and Investment Partnership (TTIP), an arrangement scrapped by the President last year.

Read more: 'Tariffs are the greatest!' Trump goads EU ahead of Juncker meeting

Allie Renison, a trade expert at the Institute of Directors in London, criticised Trump's approach on Twitter. "Outcome is what matters but on this occasion I think the process does too – and the road taken to get here risks setting a terrible precedent," she said.

A standoff remains in place over tariffs on metals and automotives, which Juncker later lambasted in a speech at the Centre for Strategic and International Studies as going "against all logic and history".

Before today's meeting, EU trade commissioner Cecilia Malmstrom had warned that if Trump were to follow through on his threats, the EU would impose $20bn-worth of tariffs on US imports.

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