STOCKS SALUTE TRADE TRUCE
tokyo — Global shares were mostly higher on Wednesday as investors pinned their hopes on a possible resolution of the bruising trade war between the US and China.
Shares rose in early European trading, tracking gains on Wall Street and in Asia. France’s CAC 40 edged up nearly 0.3 per cent in early trading to 5,070.33, while Germany’s DAX was 0.4 per cent higher at 11,175.29. Britain’s FTSE 100 edged up nearly 0.5 per cent to 7,165.82.
At 6.33am ET, Dow e-minis were up 70 points, or 0.28 per cent.
At 6.33am ET, Dow e-minis were up 70 points, or 0.28 per cent. S&P 500 e-minis were up 6 points, or 0.22 per cent and Nasdaq 100 e-minis were up 29.75 points, or 0.42 per cent. ET is expected to show that the consumer price index rose 0.1 per cent in January after recording a drop of 0.1 per cent in December.
US President Donald Trump said on Tuesday that he might let a March 2 deadline slide in trade talks with China if the two countries get close to a deal. Earlier, the White House had said it was a “hard deadline.”
“The Fed’s new reaction function is they need to see inflationary pressures before they hike again, and clearly we’ve seen those inflationary pressures aren’t there,” said Mohammed Kazmi, portfolio manager at UBP in Geneva.
As investors went back into risky assets, they sold safe-haven government bonds, driving yields up. The 10-year US Treasury yield hit a one-week high at 2.700 per cent.
The trade dispute is detrimental to the exportdependent Asian region, and a slowdown in growth in China is hurting neighbouring economies.
Japan’s benchmark Nikkei 225 added 1.3 per cent to finish at 21,144.48. Hong Kong’s Hang Seng added 1.2 per cent at 28,497.59. The Shanghai Composite index jumped 1.8 per cent to 2,721.07.
“The rally in stocks has been based on hope rather than any concrete agreements overnight,” warned Oanda senior analyst Jeffrey Halley.