HONG KONG, April 5, 2019 (BSS/AFP) – Asian markets were mostly up in
holiday-thinned trade on Friday as investors took support from hopes that
China and the United States will hammer out a trade deal after both sides
sounded notes of optimism.
With top negotiators from the world’s top two economies huddled down in
Washington for three days of talks, there has been a growing sense they are
close to an agreement to end a stand-off that battered global equities last
year.
Donald Trump on Thursday added to the sense of hope when he said the two
sides were nearing a successful conclusion.
“We will probably know over the next four weeks. It may take two weeks
after that,” he told reporters following a meeting with Beijing’s top trade
envoy and Vice Premier Liu He.
“It’s looking very good.”
Later Liu said they had “reached a new consensus on important issues”,
according to China’s Xinhua. The news agency also reported that President Xi
Jinping had called for the “early conclusion of negotiations”.
Both camps have been cautiously optimistic for months, but the last mile
is proving to be the hardest as they tussle over whether and when Washington
should remove the painful tariffs it imposed on Chinese goods last year.
While the news was once again upbeat, Asian markets were unable to press
ahead with the rally that has characterised the past two weeks, with Hong
Kong and Shanghai closed for holidays.
– ‘Devil’s in the details’ –
Tokyo ended the morning session 0.3 percent higher, Singapore added 0.4
percent and Seoul put on 0.2 percent, while Manila rose 0.4 percent and
Jakarta 0.1 percent. However, Sydney shed 0.9 percent and Wellington slipped
0.8 percent.
“There’s a little bit of a risk that it’s a sell-on-the-news event,” Ann
Miletti, at Wells Fargo Asset Management, told Bloomberg News.
“The devil is really in the details — how good is this deal going to
look?”
In forex trade, the pound was essentially flat as traders kept tabs on the
Brexit saga, with Prime Minister Theresa May set to hold a third day of talks
with opposition Labour Party leader Jeremy Corbyn to find a way to avert a
no-deal divorce.
With an April 12 deadline for leaving on the horizon, May is desperately
searching for votes to pass an agreement she struck with the EU months ago.
Brussels must decide whether to grant her plea for another delay to May
22, with one option being for a longer extension that could give Britain time
to rethink Brexit and possibly reverse its decision to leave.
“A Brexit extension is the most likely scenario from here, the length of
which could be decided by Labour backing Theresa May’s deal, in which case it
would be a short one” said OANDA analyst Alfonso Esparza.
“Or no deal is passed and the UK (asks) for a longer extension, the length
of which would have to be decided by the EU and which could be the end of
Brexit” if there is a new referendum or new elections, both of which he said
are likely scenarios.
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 0.3 percent at 21794.37 (break)
Hong Kong – Hang Seng: Closed for a public holiday
Shanghai – Composite: Closed for a public holiday
Pound/dollar: UP at $1.3081 from $1.3077 at 2100 GMT
Euro/pound: DOWN at 85.80 pence from 85.82 pence
Euro/dollar: UP at $1.1224 from $1.1221
Dollar/yen: UP at 111.70 yen from 111.66 yen
Oil – West Texas Intermediate: DOWN two cents at $62.08 per barrel
Oil – Brent Crude: DOWN 22 cents at $69.18 per barrel
New York – Dow: UP 0.6 percent at 26,384.63 (close)
London – FTSE 100: DOWN 0.2 percent at 7,401.94 (close)