HONG KONG, Dec 13, 2018 (BSS/AFP) – Asian markets enjoyed more gains
Thursday as investors are cheered by the more conciliatory noises from China
and the US on trade, while uncertainty over Brexit continued to pressure the
pound.
While the tariffs row between Beijing and Washington is far from being
resolved, there is a lot more optimism on trading floors this week that the
world’s top two economies can make headway in talks over the next three
months.
The latest buying queues came from a report that Beijing is considering
replacing its “Made in China 2025” programme that aims to boost its
technology sector, a key point in anger for Washington.
The Wall Street Journal said authorities were looking at putting back the
scheme’s timetable by a decade to concentrate on improving standards.
That followed news China had agreed to resume importing soybeans — a
major boost for US farmers — as well as remove a levy on US autos imposed
earlier this year in response to Donald Trump’s initial tariffs.
China’s technology concession “is far more relevant than China agreeing to
restart purchases of American soybeans, or even reducing the tariff on US car
imports”, said National Australia Bank strategist Ray Attrill.
Canada’s release on bail of a top executive at Chinese telecoms giant
Huawei, whose arrest had sparked fears of an adverse impact on the trade
talks, also soothed worries.
– Dollar dips –
Asian markets extended Wednesday’s gains, which helped reverse some of the
huge losses suffered last week.
Tokyo ended the morning one percent higher, while Hong Kong and Shanghai
both surged 1.3 percent.
Sydney climbed 0.4 percent and Seoul was 0.5 percent higher, while
Singapore and Taipei each rose 0.3 percent. Wellington, Manila and Jakarta
were also well in positive territory.
The upbeat mood provided another lift to higher-yielding, riskier
currencies, with the South African rand more than one percent up, while the
Chinese yuan bounced 0.3 percent.
Sterling is stuck around 20-month lows but held up against the dollar
after gaining more than one percent Wednesday in reaction to Prime Minister
Theresa May winning a no-confidence vote by her ruling Conservative party.
Investors welcomed news she had seen off the challenge, which secures her
leadership for the next 12 months, but she had to concede to stepping aside
before the 2022 election, while the vote showed that more than a third of her
own colleagues wanted her gone now.
It also highlights the uphill struggle she faces in pushing through a
controversial Brexit deal that has been slammed from all sides. She had
already called off a vote Tuesday on the agreement, knowing it would fail.
May is now hoping EU leaders will provide some concessions to help her
pass the legislation but with little hope of concessions from Brussels, the
chances Britain will leave the bloc with no deal are growing, which analysts
have said could be economically calamitous.
“The result neither guaranteed the pound’s stability nor paves the way for
a successful Brexit deal,” said Masakazu Satou, senior analyst at Gaiame
Online. “Pound-selling sentiment could revive at any time.”
– Key figures around 0230 GMT –
Tokyo – Nikkei 225: UP 1.0 percent at 21,817.62 (break)
Hong Kong – Hang Seng: UP 1.3 percent at 26,536.08
Shanghai – Composite: UP 1.3 percent at 2,636.86
Pound/dollar: DOWN at $1.2618 from $1.2629 at 2130 GMT
Euro/dollar: UP at $1.1368 from $1.1365
Dollar/yen: UP at 113.40 yen from 113.22
Oil – West Texas Intermediate UP 26 cents at $51.41 per barrel
Oil – Brent Crude: UP 34 cents at $60.49 per barrel
New York – Dow Jones: UP 0.6 percent at 24,527.27 (close)
London – FTSE 100: UP 1.1 percent at 6,880.19 (close)