You are here: Home » Reuters » News
Business Standard

Global Markets: Asian stocks up on hopes of thaw in U.S-China trade tensions

Reuters  |  SYDNEY 

By Swati Pandey

SYDNEY (Reuters) - Asian shares rose to near two-month highs on Monday on hopes of a thaw in U.S.-trade tensions as U.S. pledged to help "get back into business, fast" after a U.S. ban crippled the Chinese company.

Spreadbetters signaled a flat start for European shares with FTSE futures off 0.07 percent, while E-Minis for the rose 0.3 percent.

Trump's comments on Sunday came ahead of a second round of trade talks between U.S. and Chinese officials this week to resolve an escalating trade dispute. had said last week its stance in the negotiations would not change.

MSCI's broadest index of shares outside rose 0.4 percent, while Japan's Nikkei tacked on 0.5 percent.

Chinese shares came off the day's highs but were still upbeat after Trump's comments on ZTE, which analysts said was "a significant positive."

Shanghai's SSE Composite rose 0.2 percent while China's blue-chip was last up 0.8 percent. Hong Kong's Hang Seng index climbed more than 1 percent.

"The fact Trump is now...working to find a resolution for ZTE marks the latest sign of thawing in Beijing-relations," said.

"Trump also needs to remain on side ahead of his meeting with North Korea's Kim and this also suggests that until the 12 June meeting the signalling from the U.S. on trade will be more positive."

The has said it will lift sanctions on if agrees to completely dismantle its nuclear weapons program.

Elsewhere in Asia, the Malaysian ringgit slipped 1 percent to a four-month trough against the dollar in the first onshore trade since a shock election upset last week. It has come off lows since then, while Malaysian stocks sank as much as 2.7 percent at one point but have bounced back to be last up 0.7 percent.

Veteran came out of political retirement to lead the opposition Pakatan Harapan (Alliance of Hope) to a stunning victory against Najib Razak, a former protege he had accused of corruption.

Some investors were concerned that populist promises such as repealing an unpopular goods and services tax and restoring a petrol subsidy could undermine the country's finances.

But some analysts on Monday said Mahathir's proposals could be positive for the economy.

"The repeal of GST, while only marginally negative for the fiscal deficit, will be a boon for consumers, who have been upset that they bear the burden of and came out to vote against the establishment," said Trinh Nguyen, at


While tensions in the have eased, U.S. plans to reintroduce have stoked anxiety in the

pumps about 4 percent of the world's oil, and the latest development has sent prices near multi-year highs.

said rising prices risk causing 'stagflation', which could create a particularly "hostile environment" for risk assets.

The threatened on Sunday to impose sanctions on European companies that do business with Iran, as the remaining participants in the nuclear accord stiffened their resolve to keep that agreement operational.

In currencies, the dollar dipped was barely changed at 92.506 against a basket of major currencies after three straight days of losses.

Against the Japanese yen, it ticked up to 109.46 per dollar, remaining largely in a holding pattern since late last month.

The euro inched 0.1 percent up to $1.1958 following two consecutive sessions of gains as Italy's anti-establishment parties looked likely to form the next government.

Last week, the of England held rates steady and NewZealand's central said the official cash rate will remainat historic lows of 1.75 percent for "some time."

That leaves the Fed as the only major central in the world committed to rate increases although recent data showing moderate inflation reading has cast doubt over the pace of any hikes.

Spot gold was up 0.2 percent at $1,320.06 an ounce, after eking out a small weekly gain last week.

(Editing by & Shri Navaratnam)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

First Published: Mon, May 14 2018. 12:37 IST