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Asian markets mostly up, China trade report lifts hopes
HONG KONG, June 6, 2018 (BSS/AFP) – Asian markets mostly rose on Wednesday
as investors look ahead to a Group of Seven summit, while reports that China-
US trade talks were progressing well provided some support.
The gains extend a broad rally across the region in recent days as
optimism in the US economy, the world’s biggest, has helped temper
geopolitical worries.
The Nasdaq hit another record in New York but the lead from US traders was
generally tepid, but eyes are now on the Quebec gathering of G7 leaders, with
world trade high on the agenda after Donald Trump hit Canada, Mexico and the
European Union with steel and aluminium tariffs.
The move was condemned by Washington’s allies, with Mexico on Tuesday
announcing measures on a range of US goods from pork to bourbon, just as it
holds trilateral talks on a long-standing deal with Canada and the US.
However, Bloomberg News reported that China had offered to ramp up
purchases of various US goods during talks this week, while Washington would
ease US buying restrictions on Chinese telecom-equipment giant ZTE.
“The president is expected to meet with his advisers on whether to move
forward with this proposal or not. It has the ring of truth around it given
the Chinese said the other day that all bets are off the table if the US
imposes the tariffs,” said Greg McKenna, chief market strategist at
AxiTrader.
“They’ve thus offered both the carrot and the stick.”
– ‘Free-for-all’ –
In equities trading, Hong Kong rose 0.5 percent, having risen for four
straight days already, while Tokyo ended the morning 0.2 percent higher.
Shanghai and Singapore were barely moved, while Wellington added 0.2
percent and Taipei put on 0.5 percent.
But while markets are positive, trading floors remain susceptible to bad
news, warned Stephen Innes, head of Asia-Pacific trading at OANDA.
“Despite the absence of escalation in geopolitical risk, traders are all
too knowing that we’re little more than a spark away from re-igniting a free-
for-all, whether its EU political risk, trade wars or the more probable
escalation in Middle East tensions,” he said.
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On currency markets, the dollar is holding gains after last week’s strong
jobs report and expectations the Federal Reserve will lift interest rates
next week.
And the euro was also enjoying attention again after last week’s sell-off
fuelled by political turmoil in Italy and Spain. The single currency was
above $1.17, having fallen to a 10-month low near $1.15 last week.
However, there are concerns that the new eurosceptic government in Rome is
on a collision course with its EU partners over debt rules and eurozone
reform.
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 0.2 percent at 22,591.11 (break)
Hong Kong – Hang Seng: UP 0.5 percent at 31,255.40
Shanghai – Composite: FLAT at 3,115.01
Euro/dollar: UP at $1.1725 from $1.1717 at 0230 GMT
Pound/dollar: UP at $1.3410 from $1.3390
Dollar/yen: UP at 109.90 yen from 109.76 yen
Oil – West Texas Intermediate: UP 12 cent at $65.64 per barrel
Oil – Brent Crude: DOWN three cents at $75.35 per barrel
New York – Dow Jones: DOWN 0.1 percent at 24,799.98 (close)
London – FTSE 100: DOWN 0.7 percent at 7,686.80 (close)
BSS/AFP/HR/1025