Asian Stocks Make Gains As US/China Trade Deal Hopes Fly High
Asian Stocks Talking Points:
- Equity markets were higher across the board
- A Wall Street Journal article reported signs of trade-deal optimism
- The Australian Dollar and Chinese Yuan headed higher
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Asian stocks were all higher Monday, led by Chinese indexes which soared in turn thanks to new hopes for a trade settlement between that country and the US.
The Wall Street Journal reported on Sunday that Beijing and Washington are in the final stage of completing a trade deal. China is apparently prepared to lower tariffs on many US products, while the US will withdraw most of the sanctions put in place last year, according to the paper.
This news was doubly welcome given the clear lack of any breakthrough in last week’s talks between the US and North Korea. Sure enough, the Shanghai Composite was up by 3.1% as its close approached, with the Hang Seng up 1.4%. The Nikkei 225 added 1.1% while the ASX 200 was 0.5% higher.
The Australian benchmark remains well within a strong uptrend from late December, which has now taken it back within sight of 2018’s highs, although it has yet to reclaim these heights.
The Australian Dollar and the Chinese Yuan both edged up on trade optimism, with AUD/USD overcoming an earlier slip on weak but historic corporate profit data. The US Dollar did make gains against the haven Yen, however.
Still to come in Monday’s global trading session are construction spending data from the US, the same sector’s manufacturing Purchasing Managers Index from the UK and Eurozone producer price inflation numbers.
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--- Written by David Cottle, DailyFX Research
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.