Breaking News
Home | Business | Markets | Asian markets boosted by fresh trade hopes and ECB easing

Asian markets boosted by fresh trade hopes and ECB easing

WT24 Desk

HONG KONG – Equities rose in Asian trade Friday after the European Central Bank unveiled a fresh round of economic stimulus and another interest rate cut while a report said the US was considering a short-term trade agreement with China, AFP reports.

Global markets have been buoyed this week by a growing sense that central
banks are on the brink of easing monetary policy to support growth, and on
Thursday the ECB did not disappoint.

It said it would restart its bond-buying quantitative easing programme to
boost liquidity, provide support for struggling banks and reduce borrowing
costs deeper into negative territory in a bid to kickstart lending.
The bank said it would not lift rates until inflation moved towards its
goal of just under 2.0 percent over the medium term.

The announcement, while slightly short of expectations, was broadly
cheered by markets, sending equities in Europe and New York higher.

“In the end, it wasn’t a big bazooka, but ECB President Mario Draghi did
his level best trying to convince investors that monetary policy will remain
extremely accommodative for some considerable time to come,” said Gavin
Friend, a senior market strategist at National Australia Bank.

The euro initially plunged below $1.10 on the news Thursday before
bouncing back and in Asia it was standing its ground. The news also provided further hope that the Federal Reserve would cut rates at its meeting next week, even though data showed a jump in US inflation last month.

– ‘Deal or no deal –
Investors were given an extra fillip by a Bloomberg News report that US
officials were considering an interim trade deal with China that could freeze or cancel some tariffs if Beijing agrees to commitments on intellectual property and agricultural purchases.

The report, citing five unnamed sources, comes as tensions between the two
sides show signs of easing ahead of high-level talks in Washington next
month.

China has said it would remove some US goods from its tariffs list — with
big-ticket items including pork and soybeans also now being considered —
while Trump announced a delay to some levies on Chinese imports.

“A lot of people are talking about, and I see a lot of analysts are
saying: an interim deal, meaning we’ll do pieces of it, the easy ones first,”
Bloomberg quoted Donald Trump as saying Thursday.

“But there’s no easy or hard. There’s a deal or there’s not a deal. But
it’s something we would consider.”

Also, Treasury Secretary Steven Mnuchin said he was “cautiously
optimistic” about an agreement being reached, telling CNBC “we want to make meaningful progress”.

In early trade, Hong Kong rose 0.3 percent while Tokyo went into the break
0.9 percent higher, with Sydney and Singapore both 0.1 percent higher. Manila and Jakarta also rose but Wellington struggled.

Shanghai, Seoul and Taipei were closed for holidays.

On oil markets, both main contracts extended losses after the
International Energy Agency said growth in global demand was expected to
remain subdued citing the trade standoff and Brexit.

– Key figures around 0230 GMT –

Tokyo – Nikkei 225: UP 0.9 percent at 21,947.53 (break)

Hong Kong – Hang Seng: UP 0.3 percent at 27,174.95

Shanghai – Composite: Closed for a holiday

Euro/dollar: UP at $1.1066 from $1.1064 at 2030 GMT

Euro/pound: UP at 89.73 pence from 89.67 pence

Pound/dollar: DOWN at $1.2331 from $1.2337

Dollar/yen: UP at 108.24 yen from 108.11 yen

West Texas Intermediate: DOWN 13 cents at $54.96 per barrel

Brent North Sea crude: DOWN 13 cents at $60.25 per barrel

New York – Dow: UP 0.2 percent at 27,182.45 (close)

London – FTSE 100: UP 0.1 percent at 7,344.67 (close)

Leave a Reply

Your email address will not be published. Required fields are marked *

*

x

Check Also

Bourses bounce back

WT24 Desk Investors showed appetite to buy few large cap stocks that steered the country’s ...

Hong Kong stocks open in negative territory

WT24 Desk HONG KONG – Hong Kong stocks fell in the first few minutes of ...