Shares advance in Asia following Xi-Trump tariffs truce

5 years 1 week 6 hours ago Sunday, December 02 2018 Dec 2, 2018 December 02, 2018 9:18 PM December 02, 2018 in News

Associated Press

SINGAPORE (AP) - Asian markets were broadly higher on Monday after the U.S. and China reached a 90-day truce in a trade dispute that has dampened global growth and rattled investors worldwide.

KEEPING SCORE: Hong Kong's Hang Seng surged 2.8 percent to 27,250.48 and the Shanghai Composite index jumped 2.9 percent to 2,663.45. Japan's Nikkei 225 index climbed 1.4 percent to 22,679.19 and the Kospi in South Korea jumped 1.8 percent to 2,135.15. The S&P ASX/200 in Australia added 1.8 percent to 5,767.50. Shares rallied in Taiwan, Singapore, Indonesia and the Philippines.

WALL STREET: U.S. indexes rose Friday on hopes that President Donald Trump and his Chinese counterpart Xi Jinping would make progress on resolving a bruising tariffs dispute at their working dinner on the sidelines of the G-20 summit in Buenos Aires, Argentina. The S&P 500 index added 0.8 percent to 2,706.17. The Dow Jones Industrial Average closed 0.8 percent higher at 25,538.46 and the Nasdaq composite also rose 0.8 percent to 7,330.54. The Russell 2000 index of smaller-company stocks gained 0.5 percent to 1,533.27. The market ended November with a modest gain, after falling to a six-month low the week before.

G-20 SUMMIT: The meeting between Trump and Xi was the highlight of the summit of the major industrial nations this weekend. The leaders called a cease-fire in their trade dispute, to last for at least 90 days, to allow time to smooth out disagreements over Chinese technology policies that the U.S. and other trading partners consider predatory. Trump will hold off on plans to raise tariffs on $200 billion in Chinese goods, which were supposed to kick in on Jan. 1. In return, Xi agreed to buy a "very substantial amount" of agricultural, energy and industrial products from the U.S. to reduce its large trade deficit with China, the White House said. While the truce could steady financial markets until the end of the year, any bumps in negotiations could throw them into volatility, analysts said.

ANALYST'S TAKE: "Risk appetite has returned this morning on the positive Sino-US trade truce struck at the G20 Summit," Singapore-based DBS Group Research said in a market commentary. "There should be no wishful thinking that the truce would end the trade war between the world's two largest economies", it added. This is because it "remains to be seen if real progress could be achieved during this narrow window to resolve the contentious issues, not just on trade, but also intellectual property rights."

ENERGY: Oil futures rebounded ahead of a Dec. 6 gathering of OPEC members and other major producers in Vienna. They are expected to discuss 2019 output levels in the face of falling prices. Saudi Arabia has said it wishes to cut output, but it's unclear how large the cut will be. Benchmark U.S. crude rose $2.70 to $53.63 per barrel in electronic trading on the New York Mercantile Exchange. It lost 52 cents to finish at $50.93 a barrel on Friday. Brent crude gained $2.87 to $62.33 per barrel. It dropped 45 cents to $59.46 a barrel in London.

CURRENCIES: The dollar rose to 113.59 yen from 113.51 yen late Friday. The euro strengthened to $1.1347 from $1.1320.

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