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Sept. 4, 2019, 11:53 p.m. EDT

Asian markets gain as U.S. and China agree to new trade talks

Stocks jump in Japan, mainland China, while Hong Kong investors wait to see if political tensions ease

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By Marketwatch and Associated Press


Reuters
China's Vice Premier Liu He talks with U.S. Treasury Secretary Steven Mnuchin, right, and U.S. Trade Representative Robert Lighthizer in Beijing on March 29.

Asian markets gained in early trading Thursday after an announcement that the U.S. and China will resume trade negotiations early next month.

Investors also were cheered by encouraging global developments, including British lawmakers seeking a less chaotic exit from the European Union and easing political tensions in Hong Kong.

China’s Ministry of Commerce announced early Thursday that the two sides will meet in Washington in early October. The U.S. and China have not held formal trade talks since July, when meetings in Shanghai ended with no progress.

The agreement came in a phone call conducted by the chief Chinese envoy, Vice Premier Liu He, with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, the ministry’s statement said.

Officials will “conduct conscientious consultations” in mid-September to prepare for the talks, it said. It gave no details but said the two sides wanted to create “favorable conditions.”

U.S officials told the Wall Street Journal they were cautiously optimistic, but taking a wait-and-see approach. But investors cheered the development, which comes after the latest round of tit-for-tat tariff hikes went into effect Sept. 1.

U.S. stock futures shot up after the announcement, with Dow Jones Industrial Average futures /zigman2/quotes/210407078/delayed YM00 +0.90%  , S&P 500 futures /zigman2/quotes/209948968/delayed ES00 +0.53%   and Nasdaq Composite futures /zigman2/quotes/210219788/delayed NQ00 +0.44%   all up around 1%.

Japan’s Nikkei /zigman2/quotes/210597971/delayed JP:NIK +2.06%   surged 2.3%, while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -0.02%   rose 0.3%, as investors there wondered if new government concessions would put an end to months of protests. The Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.73%   gained 1.5% and the smaller-cap Shenzhen Composite /zigman2/quotes/210598015/delayed CN:399106 +0.13%   advanced 1.4%. South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +0.84%   rose 1.2%, while benchmark indexes in Taiwan /zigman2/quotes/210597977/delayed TW:Y9999 +0.27%  , Singapore /zigman2/quotes/210597985/delayed SG:STI +0.29%   and Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX +1.40%   all advanced. Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +2.32%   rose 0.9%.

Among individual stocks, Japan Steel /zigman2/quotes/207991538/delayed JP:5631 +1.22%   soared in Tokyo trading, while SoftBank /zigman2/quotes/207303954/delayed JP:9984 +2.68%  , Sony /zigman2/quotes/201361720/delayed JP:6758 +1.69%   and Fast Retailing /zigman2/quotes/200663563/delayed JP:9983 +3.82%   posted solid gains. In Hong Kong, Apple component makers AAC /zigman2/quotes/201441510/delayed HK:2018 -1.71%   and Sunny Optical /zigman2/quotes/206687505/delayed HK:2382 -0.85%   rose, while property developers such as New World /zigman2/quotes/202357413/delayed HK:17 -2.60%   and Link Real Estate /zigman2/quotes/206625692/delayed HK:823 -1.45%   fell. Samsung /zigman2/quotes/209800866/delayed KR:005930 +2.20%   jumped in South Korea, after announcing the long-delayed launch of its new foldable smartphone, and Taiwan Semiconductor /zigman2/quotes/207385621/delayed TW:2330 +0.17%  advanced in Taiwan. Rio Tinto /zigman2/quotes/200083756/delayed AU:RIO +1.97%   and ANZ Banking /zigman2/quotes/205482049/delayed AU:ANZ +6.47%   gained in Australia.

Shares rallied on Wall Street on Wednesday, reversing Tuesday’s losses, when disappointing U.S. manufacturing data and an escalation in the ongoing trade war between the U.S. and China led to a sell-off that ended a three-day winning streak for the market.

The S&P 500 /zigman2/quotes/210599714/realtime SPX +1.48%   gained 31.51 points, or 1.1%, to 2,937.78. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +2.21%  rose 237.45 points, or 0.9%, to 26,355.47. The Nasdaq /zigman2/quotes/210598365/realtime COMP +0.77%  , which is heavily weighted with technology stocks, climbed 102.72 points, or 1.3%, to 7,976.88.

Investors have been worried that the trade war and a slowing global economy could tip the U.S. into a recession. But traders set aside those concerns Wednesday, focusing instead on geopolitical developments.

In Hong Kong, the government withdrew an extradition bill that had set off three months of protests.

In Europe, Britain’s parliament took a big step toward passing a law that could stop Prime Minister Boris Johnson’s plan to pull out of the EU on Oct. 31 with or without a withdrawal agreement. Leaving the EU without a deal that covers trade and other issues could result in economic chaos for Britain and complicate trade with member nations in the EU.

The lingering trade conflict between Washington and Beijing has roiled markets this summer. The economic uncertainty has also become a drag on companies.

On Sunday, the conflict escalated as the U.S. imposed a 15% tariff on about $112 billion of Chinese products. China responded by charging tariffs of 10% and 5% on a list of American goods.

The escalation had been expected since early August when the U.S. announced plans for the new tariff measures, prompting China to retaliate.

After Thursday’s news of renewed trade talks, some analysts warned against too much optimism.

“While a drop in geopolitical risk premium comes as a welcome relief, but with the omnipresent trade war clouds looming ominously over the market threatening to come thundering down at any time, the air remains thick with caution,” said Stephen Innes, Asian Pacific market strategist with AxiTrader.

Benchmark crude oil   edged up 12 cents to $56.38 a barrel. It rose $2.32 to settle at $56.26 a barrel Wednesday. Brent crude oil  , the international standard, gained 17 cents to $60.87 a barrel.

The dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.1086%   rose to 106.63 Japanese yen from 106.21 yen on Wednesday.

/zigman2/quotes/210407078/delayed
US : U.S.: CBOT
$ 25,763.00
+229.00 +0.90%
Volume: 16,857
May 27, 2020 9:18p
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/zigman2/quotes/209948968/delayed
US : U.S.: CME
$ 3,051.50
+16.10 +0.53%
Volume: 79,791
May 27, 2020 9:18p
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/zigman2/quotes/210219788/delayed
US : U.S.: CME
$ 9,474.00
+41.50 +0.44%
Volume: 25,549
May 27, 2020 9:18p
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/zigman2/quotes/210597971/delayed
JP : Nikkei
21,860.57
+441.34 +2.06%
Volume: 0.00
May 28, 2020 11:08a
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/zigman2/quotes/210598030/delayed
HK : Hong Kong Exchange
23,295.76
-5.60 -0.02%
Volume: 510,792
May 28, 2020 10:13a
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/zigman2/quotes/210598127/delayed
CN : China: Shanghai
2,857.61
+20.81 +0.73%
Volume: 7.55B
May 28, 2020 10:13a
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/zigman2/quotes/210598015/delayed
CN : Shenhzen Stock Exchange
1,776.58
+2.36 +0.13%
Volume: 9.97B
May 28, 2020 10:13a
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/zigman2/quotes/210598069/delayed
KR : Korea Exchange
2,048.32
+17.12 +0.84%
Volume: 483,535
May 28, 2020 11:08a
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/zigman2/quotes/210597977/delayed
TW : Taiwan Stock Exchange
11,044.14
+29.48 +0.27%
Volume: 0.00
May 28, 2020 10:08a
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/zigman2/quotes/210597985/delayed
SG : Singapore: SGX
2,526.74
+7.26 +0.29%
Volume: 0.00
May 28, 2020 10:13a
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/zigman2/quotes/210597981/delayed
ID : Indonesia Stock Exchange
4,706.67
+65.12 +1.40%
Volume: 0.00
May 28, 2020 9:18a
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/zigman2/quotes/210598100/delayed
AU : S&P ASX
5,908.70
+133.70 +2.32%
Volume: 502,262
May 28, 2020 12:08p
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/zigman2/quotes/207991538/delayed
JP : Japan: Tokyo
¥ 1,656.00
+20.00 +1.22%
Volume: 269,800
May 28, 2020 11:08a
P/E Ratio
13.08
Dividend Yield
2.72%
Market Cap
¥115.59 billion
Rev. per Employee
¥42.50M
loading...
/zigman2/quotes/207303954/delayed
JP : Japan: Tokyo
¥ 4,861.00
+127.00 +2.68%
Volume: 14.93M
May 28, 2020 11:08a
P/E Ratio
32.61
Dividend Yield
0.91%
Market Cap
¥9936.70 billion
Rev. per Employee
¥126.96M
loading...
/zigman2/quotes/201361720/delayed
JP : Japan: Tokyo
¥ 6,864.00
+114.00 +1.69%
Volume: 4.06M
May 28, 2020 11:08a
P/E Ratio
14.90
Dividend Yield
0.66%
Market Cap
¥8220.23 billion
Rev. per Employee
¥72.37M
loading...
/zigman2/quotes/200663563/delayed
JP : Japan: Tokyo
¥ 59,180.00
+2,180 +3.82%
Volume: 693,700
May 28, 2020 11:08a
P/E Ratio
40.61
Dividend Yield
0.81%
Market Cap
¥5796.25 billion
Rev. per Employee
¥40.83M
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/zigman2/quotes/201441510/delayed
HK : Hong Kong
HK$ 40.30
-0.70 -1.71%
Volume: 3.08M
May 28, 2020 10:13a
P/E Ratio
19.45
Dividend Yield
0.99%
Market Cap
HK$49.97 billion
Rev. per Employee
HK$411,637
loading...
/zigman2/quotes/206687505/delayed
HK : Hong Kong
HK$ 104.40
-0.90 -0.85%
Volume: 992,785
May 28, 2020 10:13a
P/E Ratio
25.41
Dividend Yield
0.78%
Market Cap
HK$118.24 billion
Rev. per Employee
HK$1.08M
loading...
/zigman2/quotes/202357413/delayed
HK : Hong Kong
HK$ 7.87
-0.21 -2.60%
Volume: 7.80M
May 28, 2020 10:13a
P/E Ratio
10.20
Dividend Yield
6.48%
Market Cap
HK$83.33 billion
Rev. per Employee
HK$1.84M
loading...
/zigman2/quotes/206625692/delayed
HK : Hong Kong
HK$ 57.95
-0.85 -1.45%
Volume: 4.89M
May 28, 2020 10:13a
P/E Ratio
6.91
Dividend Yield
4.87%
Market Cap
HK$124.40 billion
Rev. per Employee
HK$11.26M
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/zigman2/quotes/209800866/delayed
KR : S. Korea: KRX
51,000.00
+1,100 +2.20%
Volume: 15.36M
May 28, 2020 11:08a
P/E Ratio
16.27
Dividend Yield
2.78%
Market Cap
₩334539.00 billion
Rev. per Employee
N/A
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/zigman2/quotes/207385621/delayed
TW : Taiwan
NT$ 297.00
+0.50 +0.17%
Volume: 8.04M
May 28, 2020 10:08a
P/E Ratio
19.21
Dividend Yield
3.37%
Market Cap
NT$7662.43 billion
Rev. per Employee
N/A
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/zigman2/quotes/200083756/delayed
AU : Australia: Sydney
$ 93.33
+1.81 +1.97%
Volume: 496,048
May 28, 2020 12:08p
P/E Ratio
13.30
Dividend Yield
7.04%
Market Cap
$151.59 billion
Rev. per Employee
$1.14M
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/zigman2/quotes/205482049/delayed
AU : Australia: Sydney
$ 19.10
+1.16 +6.47%
Volume: 9.11M
May 28, 2020 12:08p
P/E Ratio
13.06
Dividend Yield
11.43%
Market Cap
$46.77 billion
Rev. per Employee
$908,476
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/zigman2/quotes/210599714/realtime
US : S&P US
3,036.13
+44.36 +1.48%
Volume: 3.66B
May 27, 2020 5:16p
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/zigman2/quotes/210598065/realtime
US : Dow Jones Global
25,548.27
+553.16 +2.21%
Volume: 420.36M
May 27, 2020 5:16p
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/zigman2/quotes/210598365/realtime
US : U.S.: Nasdaq
9,412.36
+72.14 +0.77%
Volume: 4.07M
May 27, 2020 5:16p
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/zigman2/quotes/210561789/realtime/sampled
US : Tullett Prebon
107.8380
+0.1170 +0.1086%
Volume: 0.0000
May 27, 2020 10:28p
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