Thursday, 21 October 2021

Asian markets bounce back on US-China trade talks

HONG KONG: Asian markets opened higher after a positive lead from Wall Street and Europe, with investors cautiously optimistic about upcoming US-China trade talks.

Negotiators from Washington and Beijing will meet later this month in the first publicly announced meeting in weeks on their bitter trade dispute, which has seen both sides impose reciprocal tariffs on goods worth $34 billion.

The news helped global markets regain composure after several days of volatility induced by Turkey’s financial crisis, and fears that its troubles could infect other economies.

Tokyo was rose 0.5 percent, Hong Kong added 0.4 percent, and Shanghai edged up 0.1 percent in early Asian trade.

Despite the boost, analysts have said a quick resolution of the trade spat between the world’s top two economies is unlikely, with more US tariffs in the works on further Chinese goods.

Markets were “cautiously optimistic” about prospects of resolving the trade war after Beijing announced it would send a representative to Washington, although Rodrigo Catril of National Australia Bank noted the “relatively low rank of the negotiators” meant reaction was guarded.

Fears also remain about Turkey’s financial crisis despite the recent stabilisation of the lira, after Washington warned that it would levy more economic sanctions on Ankara if it did not released a jailed American pastor.

Meanwhile, sentiment on Wall Street was also boosted by Walmart’s strong earnings. The three main New York indices all closed up.

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