HONG KONG, Jan 25, 2019 (BSS/AFP) – Asian markets rose Friday putting them
on course to end a shaky week on a positive note as investors look ahead to
crucial trade talks between China and the United States at the end of the
month.
Small signs of a break in the impasse on Capitol Hill also provided some
hope, with Democrats and Republicans meeting to end the month-long government
shutdown that is taking its toll on the economy and left hundreds of
thousands of workers unpaid.
Wall Street provided a mixed lead, though the technology sector was
supported by strong earnings from US semiconductor firms such as Texas
Instruments, while energy firms tracked healthy gains in oil prices.
There are hopes that next week’s meeting in Washington between top Chinese
and US officials will see some progress, but Commerce Secretary Wilbur Ross
looked to temper expectations Thursday by saying the two sides are “miles and
miles” from resolving their trade war.
However, he still offered some hope, saying: “I believe China would like
to make a deal. I believe we would like to make a deal but it has to be a
deal that works for both parties.
“I’m trying to say people shouldn’t think the events of next week will be
the solution to all of the issues between the United States and China.”
Edward Moya, a market analyst at OANDA, pointed out that US markets were
niggled by the “miles away” comment, but said that “many failed to focus on
the rest of his comments that there is a fair chance a deal will get done,
just not this week”.
– ‘We’re talking, we’re talking’ –
In morning trade Hong Kong rose more than one percent and Shanghai added
0.6 percent while Tokyo went into the break one percent higher.
Sydney jumped 0.8 percent, Singapore gained 0.5 percent and Seoul was 0.7
percent higher. Taipei was nearly one percent up, while Manila, Wellington
and Jakarta were also well up.
The gains put the region on course for a positive end to a week that
started on a dour note as China reported its economy was growing at its
slowest pace in 28 years.
In Washington two bills to end the shutdown were thrown out by the senate
but the president signalled he could back a “reasonable” proposal that
includes border security. However, Democrats reasserted they will not provide
cash for a Mexican border wall.
Both parties leaders in the Senate met Thursday to discuss the issue, with
Schumer later seen smiling and saying: “We’re talking, we’re talking”.
OANDA’s Moya said that with Donald Trump fighting the trade war as well as
the US shutdown he would need to make some headway on one some time soon.
“The president needs a win, and he will need to decide soon whether he
will move forward in resolving the shutdown or the trade war with China,” he
said. “If he leaves both at their current states, he will see all the stock
market gains and confidence in the economy evaporate.”
Oil prices rallied more than one percent as instability in Venezuela
fuelled concerns about supplies from the major producer, with Trump weighing
sanctions on Nicolas Maduro’s regime and backing opposition leader Juan
Guaido as the country’s interim president.
“It’s a function of people keeping an eye on supply concerns out of
Venezuela,” Marshall Steeves, an energy markets analyst at Informa Economics,
told Bloomberg News. “That’s the overriding issue today.”
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 1.0 percent at 20,783.67 (break)
Hong Kong – Hang Seng: UP 1.2 percent at 27,438.82
Shanghai – Composite: UP 0.6 percent at 2605.98
Euro/dollar: DOWN at $1.1310 from $1.1313 at 2140 GMT
Pound/dollar: UP at $1.3114 from $1.3058
Dollar/yen: UP at 109.75 yen from 109.57
Oil – West Texas Intermediate: UP 75 cents at $53.88 per barrel
Oil – Brent Crude: UP 76 cents at $61.85 per barrel
New York – DOW: DOWN 0.1 percent at 24,553.24 (close)
London – FTSE 100: DOWN 0.4 percent at 6,818.95 (close)