Asia shares reach three-month peak as risk embraced
By Wayne Cole SYDNEY (Reuters) - Asian shares scaled a three-month high on Tuesday after Wall Street hit all-time peaks amid hopes of progress in Sino-U.S. trade talks and for another dose of policy stimulus from the Federal Reserve this week

By Wayne Cole
SYDNEY (Reuters) - Asian shares scaled a three-month high on Tuesday after Wall Street hit all-time peaks amid hopes of progress in Sino-U.S. trade talks and for another dose of policy stimulus from the Federal Reserve this week.
Japan's Nikkei <.N225> led the way with a rise of 0.6% to reach ground last trod a full year ago. MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> crept up 0.2% in early trade to its highest since late July.
E-Mini futures for the S&P 500
U.S. President Donald Trump said on Monday he expected to sign a significant part of the trade deal with China ahead of schedule but did not elaborate on the timing.
The U.S. trade representative also said they were studying whether to extend tariff suspensions on $34 billion of Chinese goods set to expire on Dec. 28 this year.
"The market appears to be interpreting the improvement in trade talks as a positive sign that the U.S. will suspend its planned tariffs on $160 billion of Chinese imports due to take place in December," said Rodrigo Catril, a senior FX strategist at National Australia Bank.
"This is a big assumption as talks could easily fail again if both parties don't find a compromise."
On Wall Street, the S&P 500 <.SPX> gained 0.56% to score a record closing peak, while the Dow <.DJI> rose 0.49% and the Nasdaq <.IXIC> 1.01%. [.N]
Microsoft Corp
Google parent Alphabet Inc
HANGING ON THE FED
The embrace of risk left bonds out in the cold, and yields on two-year Treasury notes
Bond investors are still looking forward to a likely rate cut from the Federal Reserve on Wednesday, though they also suspect officials might sound cautious on moving yet further.
"Some/many Fed participants may think/hope that the October cut will be the last of this cycle," Michelle Girard, chief U.S. economist at NatWest Markets, said in a report.
"However, we expect weaker data over the coming months and quarters will force the Fed to lower rates further. We look for rate cuts in October, December, March, and June, dropping the fed funds target range to 0.75%-1.00% by the middle of 2020."
That view is even more aggressive than the futures market, which has 50 basis points of cuts priced in by June
Central banks in Japan and Canada also meet this week, with talk the former might ease further if only to prevent an export-sapping bounce in its currency.
The shift from safe havens was working to weaken the yen. The dollar was firm at 108.98 yen
It fared less well on the euro, which edged up to $1.1097
Sterling firmed after the European Union agreed to a Brexit delay of up to three months, while Prime Minister Boris Johnson lost a vote to force an election on Dec. 12.
The pound was last at $1.2858
Spot gold slipped back to $1,491.43 per ounce
Oil prices steadied after taking a knock from signs of rising U.S. stockpiles. [O/R]
Brent crude
(Editing by Jacqueline Wong)
This story has not been edited by Firstpost staff and is generated by auto-feed.
also read

France, Germany to agree to NATO role against Islamic State - sources | Reuters
By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class | Reuters
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.