Asian stocks rally to record high ahead of trade deal; yen slips
By Tom Westbrook SINGAPORE (Reuters) - Asian share markets rose on Tuesday and safe-haven assets slid as signs of goodwill between China and the United States supported optimism for global growth, with the world's two biggest economies preparing to formalise a trade-war truce. The U.S. Treasury Department on Monday said China should no longer be designated a currency manipulator - a label it applied as the yuan slid in August
By Tom Westbrook
SINGAPORE (Reuters) - Asian share markets rose on Tuesday and safe-haven assets slid as signs of goodwill between China and the United States supported optimism for global growth, with the world's two biggest economies preparing to formalise a trade-war truce.
The U.S. Treasury Department on Monday said China should no longer be designated a currency manipulator - a label it applied as the yuan slid in August. China, meanwhile, has allowed the tightly managed currency to climb to its highest point since July.
China's offshore yuan extended strong gains to the dollar on Tuesday morning to a 5-1/2-month high, supported by rising optimism towards Sino-U.S. trade developments.
The offshore yuan surged to a high of 6.8745 per dollar, the firmest level since July 26.
The moves come as a high-level Chinese delegation arrived in Washington ahead of Wednesday's signing of the Phase 1 trade agreement, a step toward de-escalating a prolonged dispute that has hurt the world economy.
MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> opened at an all-time high and drifted higher.
Japan's Nikkei <.N225> added 0.8% and hit its highest point in a month. Australia's S&P/ASX 200 <.AXJO> rose 0.7% and touched a fresh record intraday high. Gold fell and the safe-haven Japanese yen
"The market appears to be fully pricing a signed agreement," said CMC Markets' chief strategist in Sydney, Michael McCarthy.
With the text of the deal still yet to be finalised, the gains could leave stocks exposed should anything go awry, he added, pointing to modest morning volumes hinting at caution.
"It's buy the rumour, sell the fact...even a delay could see an extremely negative reaction," he said.
United States Trade Representative Robert Lighthizer told Fox Business late on Monday that the Chinese translation of the deal's text was almost done.
"We're going to make it public on Wednesday before the signing," he said.
Overnight Wall Street made new record closing highs, driven by sharp rises in tech stocks as investors bet firms such as Facebook Inc
The S&P 500 <.SPX> rose 0.7% to a record closing high, while the Nasdaq Composite <.IXIC> added 1% and also closed at a record peak. The Dow Jones Industrial Average <.DJI> rose 0.29%.
In tandem with the rally, safe-haven assets slipped and slid lower on Tuesday. Gold extended Monday's fall to trade 0.2% weaker at $1545.15 per ounce.
Oil prices nursed losses and yields on benchmark U.S. Treasuries rose as prices fell. U.S. crude
In currency markets, the Japanese yen weakened past the 110 yen-per-dollar mark while the trade-exposed yuan
Besides the trade deal, investors are also looking to U.S. inflation data due later on Tuesday and the beginning of the fourth-quarter U.S. company results season.
Big banks JPMorgan Chase & Co
(Reporting by Tom Westbrook in Singapore)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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