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Asian markets rise with Wall St, pound flat as Brexit delay eyed
HONG KONG, Oct 24, 2019 (BSS/AFP) – Most Asian markets rose Thursday following a positive lead from Wall Street, while the pound was marginally higher as traders await the next Brexit move with the EU expected to extend Britain’s divorce deadline yet again.
While US earnings on Wednesday were a mixed bag, investors remain broadly upbeat after better-than-forecast results so far have soothed worries about the impact of slowing economic growth on companies.
“People were bracing for the worst” for businesses, Yana Barton at Eaton Vance Management said. “So far we’re coming in a little bit better,” she told Bloomberg TV.
Hong Kong finished 0.9 percent better off while Tokyo closed with gains of 0.6 percent.
Seoul added 0.2 percent as dealers brushed off data showing the South Korean economy grew in the third quarter at a slower pace than expected, putting it on course for the worst annual performance since the global financial crisis.
Sydney, Singapore, Mumbai, Taipei and Jakarta were also well up. Shanghai was marginally lower while Wellington and Bangkok were also in the red.
London rose 0.6 percent in the morning, while Paris added 0.5 percent and Frankfurt gained 0.7 percent.
The positive mood comes as China and the US look on track to sign a mini trade deal next month and set up talks for the next phase of a wider agreement to end their long-running tariffs war.
Hopes that Britain will leave the European Union with a divorce pact have also improved sentiment.
While Boris Johnson failed to push his agreement with the bloc in time to meet the October 31 cut-off date, he did manage to get MPs to agree to it.
EU leaders are expected to grant a three-month extension, in which time the prime minister could hold a general election he hopes will give him enough lawmakers to easily break the Brexit deadlock.
– ‘Still waiting’ –
Sterling, which has seen strong volatility for most of the week, fluctuated in a tight range against the dollar Thursday as dealers await their next cue.
“Brexit remains of great concern, and though few developments materialised (Wednesday) the market is maintaining confidence a deal will be coming,” said AxiTrader analyst Stephen Innes.
“Traders are still awaiting the EU decision on whether it will grant a delay until January 31, and under what conditions.”
Oil prices edged down after running up strong gains of more than 2.5 percent Wednesday in response to data showing a slide on US stockpiles as well as a bigger-than-expected fall in gasoline inventories.
However, the selling in Asian trade came as investors remain concerned about the fact that OPEC and other major producers led by Russia had not yet put forward any plans for changes to their output cuts that have helped support prices for years.
On currency markets, the largely positive mood provided a lift to higher-yielding, riskier units such as the South Korean won and Indonesian rupiah.
The Turkish lira ticked up after Donald Trump ended sanctions on the country that were recently imposed over its operations against Kurdish forces in northern Syria.
He said he was lifting the sanctions because a ceasefire was holding in the area, calling it a “major breakthrough”.
– Key figures around 0810 GMT –
Tokyo – Nikkei 225: UP 0.6 percent at 22,750.60 (close)
Hong Kong – Hang Seng: UP 0.9 percent at 26,797.95 (close) Shanghai – Composite: FLAT at 2,940.92 (close)
London – FTSE 100: UP 0.6 percent at 7,304.10
Pound/dollar: DOWN at $1.2910 from $1.2912 at 2130 GMT
Euro/pound: UP at 86.33 pence from 86.19 pence
Euro/dollar: UP at $1.1141 from $1.1131
Dollar/yen: UP at 108.68 yen from 108.65 yen
West Texas Intermediate: DOWN 35 cents at $55.62 per barrel
Brent North Sea crude: DOWN 16 cents at $61.01 per barrel
New York – Dow: UP 0.2 percent at 26,833.95 (close)
BSS/AFP/MMA/1500HRS