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ASIA-MARKETS-UPDATE
Most Asian markets on the rise as trade optimism returns
HONG KONG, Nov 22, 2019 (BSS/AFP) – Asian markets mostly rose Friday as a
sense of optimism returned to trading floors after a report said China’s
point man on the US tariffs talks had offered to host a meeting to help push
through their crucial mini pact.
However, investors were nervous that the deal could collapse at any minute
after US lawmakers passed a bill supporting Hong Kong rights, causing anger
in Beijing.
Expectations that the economic superpowers would be able to sign off on the
agreement soon has helped fan a rally across world markets for weeks, though
a lack of detail or signs of progress of late is becoming unsettling for
many.
Hopes were given a lift Thursday after the Wall Street Journal said top
negotiator Vice Premier Liu He had invited his US counterparts for further
discussions to haul the deal over the line.
That came a day after He had expressed confidence they would eventually
reach a breakthrough.
Adding to the positivity was a report in the South China Morning Post that
said Washington would probably delay imposing fresh tariffs planned for next
month, even if they have not reached a deal by then.
The rolling back of levies is a key demand of China’s in the talks.
“The market is looking for some bullish signal that things aren’t going to
get worse and that we’re not going to see further deterioration in trade
talks between the US and China,” Erin Browne, at Pacific Investment
Management, told Bloomberg TV.
“They just don’t want to see further escalation.”
– China ‘not afraid’ –
On Friday, President Xi Jinping said China wanted to hammer out a deal but
was “not afraid” to fight back when necessary. He told former US officials
and other foreign dignitaries at a meeting in Beijing that he wanted to “work
for a phase-one agreement on the basis of mutual respect and equality”.
The remarks came two days after Donald Trump complained Beijing had not
made sufficient concessions so far, making him reluctant to conclude a
bargain.
MORE/HR/1442
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ASIA-MARKETS-UPDATE 2 LAST HONG KONG
Asian investors broadly maintained early gains. Hong Kong added 0.5 percent
and Tokyo ended up 0.3 percent.
Singapore rose 0.7 percent, Sydney rose 0.6 percent, Seoul and Bangkok
gained 0.3 percent, while Taipei was up 0.1 percent.
However, Shanghai slipped 0.6 percent while Wellington, Mumbai and Jakarta
were in the red.
Eyes are on the White House after Congress sent the Hong Kong bill to Trump
to sign into law. Beijing has warned of consequences over the bill and there
are fears for the trade talks if Trump signs it. Worries about China’s
reaction caused a sharp drop on global markets Thursday.
Still, some observers say that while highly contentious, the bill will more
likely prevent a more detailed agreement being reached rather than cause the
complete collapse of the talks.
Stephen Innes at AxiTrader said the fact that Liu had offered the
invitation and remained optimistic “indicates that China may be willing to
compartmentalise this contentious bill away from the broader trade
negotiations”.
But he added that “this tangled web of trade talk confusion has investors
sitting in that all-too-familiar predicament of trade war limbo”.
And David Madden at CMC Markets said that Thursday “was a bit of a downbeat
day as stocks lost ground, but if traders were genuinely fearful about the
trade story, stocks would be much lower”.
The broadly upbeat mood provided support to higher-yielding currencies such
as the South African rand and Mexican peso but others struggled to keep early
gains, with the South Korean won dipping in the afternoon.
Oil prices slipped after enjoying a strong rally Thursday, with investors
keeping close tabs on developments in the trade talks.
In early trade London rose 0.4 percent, while Paris and Frankfurt were both
0.2 percent higher.
– Key figures around 0820 GMT –
Tokyo – Nikkei 225: UP 0.3 percent at 23,122.88 (close)
Hong Kong – Hang Seng: UP 0.5 percent at 26,595.08 (close)
Shanghai – Composite: DOWN 0.6 percent at 2,885.29 (close)
London – FTSE 100: UP 0.4 percent at 7,269.49
Euro/dollar: UP at $1.1070 from $1.1059 at 2140 GMT
Pound/dollar: UP at $1.2926 from $1.2907
Euro/pound: DOWN at 85.65 pence from 85.67 pence
Dollar/yen: DOWN at 108.58 yen from 108.60 yen
West Texas Intermediate: DOWN 33 cents at $58.25 per barrel
Brent North Sea crude: DOWN 35 cents at $63.62 per barrel
New York – Dow: DOWN 0.2 percent at 27,766.29 (close)
BSS/AFP/HR/1445