Stocks Mixed As Oil Prices Rise, US, China to Keep Talking On Trade
Asian Stocks Talking Points:
- The US-China trade story was subject to some mixed signals.
- Oil prices rose on reports that Saudi supply could take a while to fully return
- UK travel agent Thomas Cook collapsed, leading to problems for its regional partners.
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Investors were without usual regional bellwether Japan. The Nikkei 225 was closed for a holiday. Chinese stocks slipped, however. The country’s Ministry of Commerce said over the weekend that economic and trade teams from China and the US had ‘constructive’ talks and would remain in contact. However, US shares had retreated on Friday after the Chinese delegation returned home earlier than planned, cancelling some farm visits.
Oil prices rose on Monday on reports that Saudi state producer Aramco’s repairs from recent drone attacks could take longer than expected, with consequent effects on global oil supply.
US benchmark crude oil prices remain well below their post-strike peaks but remain within a higher trading range than previously as investors respond to news flow.
Regional oil firms endured differing fortunes on this news. China’s CNOOC was lower but Australia’s Beach Energy rose sharply as did South Korea’s S-Oil. The Hang Seng was down overall. Sentiment was not helped by the collapse of Thomas Cook, the venerable UK travel name. China’s Fosun is the largest shareholder.
The ASX 200 was a notable regional gainer. It was up 0.3% as its afternoon session got under way. Retailer Premier Investments was in demand after a broker upgrade. The tech sector’s good run seemed to be over though as investors eyed a weaker Nasdaq performance. Australia’s Webjet saw its stock fall, again thanks to links with Thomas Cook.
There are plenty of likely points of interest still to come on Monday. Prominent on the schedule are US Purchasing Managers Index data and testimony to the European Parliament from European Central Bank President Mario Draghi.
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--- Written by David Cottle, DailyFX Research
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