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Asian markets tick up after Trump tweets but uncertainty remains

AFP  |  Hong Kong 

A series of tweets by playing up the chances of a trade deal with provided a much-needed boost to Asian equities Wednesday but investors trod cautiously as analysts warned of more to come.

After more than doubling tariffs on USD 200 billion of Chinese goods last week -- sparking a retaliation from -- Trump has threatened to hit a further USD 300 billion with more levies if he does not get his way in high-stakes talks.

However, in a series of tweets Tuesday the gave markets some hope that a deal between the economic titans will eventually be struck with his counterpart

"When the time is right we will make a deal with China", he wrote, adding that his "respect and friendship with Xi is unlimited".

He went on to say: "We can make a deal with tomorrow, before their companies start leaving so as not to lose USA business" and called on the Federal Reserve to "match" whatever the Chinese central does to support the US economy.

The remarks, while again accusing of backsliding in the trade talks, provided some optimism and in early trade was up 0.8 per cent while Hong Kong put on 0.6 per cent and rose 0.5 per cent.

added 0.6 per cent, while Taipei, Wellington, and were also well in positive territory. was barely moved.

However, went into the break 0.8 percent lower.

Both sides have said they will resume talks in but with no date yet set dealers are looking ahead to a possible meeting between Trump and Xi at the in at the end of June.

"It's just too early to tell if this is a buy (on equity markets), on slightly oversold conditions, or if it's the start of stabilisation," Gina Martin Adams, at Intelligence, told TV.

"Our working thesis is that we're going to be in for a period of for most of the next month as we await the meeting."

And warned that "sentiment remains fragile and subject to the whims of trade headlines on either tickers or social media accounts".

He added that while some gains could be expected "one suspects a lot of money will remain on the sidelines as we await more clarity on the trade situation".

prices dipped in Asian trade on Wednesday following a surprising rise in US crude stockpiles but remain propped up by tensions in the

said Tuesday a pumping facility on the had been attacked by armed drones, an act claimed by Yemeni rebels.

That came days after sabotage attacks on four ships, including two Saudi Arabian tankers, in the

"Trade issues will continue to cap gains in Asia, but if anything, the incidents on opposite sides of will bring home how vulnerable the flow of is from the Middle East," said Halley.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, May 15 2019. 08:40 IST
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