Asian markets mostly up on China-US pact
Credit to Author: Agence France-Presse| Date: Mon, 13 Jan 2020 16:16:10 +0000
HONG KONG: Asian markets mostly rose Monday as investor attention turned from the Middle East to the global economic outlook and this week’s planned signing of the China-United States trade pact.
Trading at the Philippine Stock Exchange was suspended also on Monday from the Taal Volcano eruption, which caused the suspension of classes and work in government offices.
Ash fall from Taal reached parts of Metro Manila on Sunday afternoon.
While the optimism that characterized the end of 2019 is returning to trading floors, dealers were left a little disappointed by a below-par jobs report out of Washington, which also showed a slower pace of wage growth.
All three main indexes on Wall Street ended in negative territory following the reading, having hit new highs, with profit-taking also playing a role.
However, analysts pointed out that while the data missed expectations, it did suggest that the Federal Reserve will likely maintain interest rates at low levels for some time to come, with some tipping the next move could be another cut.
Hong Kong rallied more than 1 percent and Shanghai ended up 0.8 percent, while Seoul jumped 1 percent, Mumbai put on 0.6 percent and Bangkok gained 0.3 percent.
Taipei rose 0.7 percent after Tsai Ing-wen won a landslide victory last weekend and was returned as the island-nation’s president for a second term, with investors cheering the removal of uncertainty caused by the election.
The Taiex is sitting at its highest levels in three decades, while the Taiwan dollar is also at an 18-month peak, boosted by government moves to attract foreign cash and encourage local firms to invest at home.
Among other bourses, Sydney shed 0.4 percent, Singapore eased 0.2 percent and Wellington slipped 0.1 percent. Tokyo was closed for a holiday.
Dollar slips
Focus this week is on Washington, where China and the US will finally put pen to paper on their much-vaunted “phase one” trade deal, which has lowered tensions between the economic superpowers and boosted hopes for the global economy.
While there are not expected to be any major announcements at the signing, investors will be looking for signs of progress on the next part of negotiations for a wider agreement.
“Provided the deal inks a commitment from China to increase agricultural products and outlines a dependable enforcement mechanism, the market will go merrily along the way,” said AxiTrader’s Stephen Innes.
“Traders are probably not too concerned about a currency pact as China should hold the line on any weakness in the yuan as we roll forward to negotiating phase two,” he added.
On foreign exchanges, the dollar was down against most high-yielding, riskier units as confidence returns to markets after the volatile start to the year, with the Indonesian rupiah rallying 0.7 percent and the South Korean won rising 0.5 percent.
Oil prices were slightly up but remain under pressure on waning concerns about Middle East supplies, rising US shale production and following a pick-up in output from non-Organization of the Petroleum Exporting Countries such as Norway.
In early European trade, London and Paris each rose 0.2 percent, while Frankfurt added 0.3 percent.