Asian stocks set for cautious gains on Sino-U.S. trade hopes

By Katanga Johnson WASHINGTON (Reuters) - Asian stock were set for a choppy session on Wednesday, following a mixed Wall Street lead as markets cheered signs of progress in U.S.-Sino trade negotiations but remained cautious about the broader economic outlook. Top U.S. and Chinese officials reaffirmed their commitment to a trade deal that had appeared on shaky ground because of worsening bilateral ties following weeks of escalating tensions between the world's two largest economies.

Reuters August 26, 2020 07:05:38 IST
Asian stocks set for cautious gains on Sino-U.S. trade hopes

Asian stocks set for cautious gains on SinoUS trade hopes

By Katanga Johnson

WASHINGTON (Reuters) - Asian stock were set for a choppy session on Wednesday, following a mixed Wall Street lead as markets cheered signs of progress in U.S.-Sino trade negotiations but remained cautious about the broader economic outlook.

Top U.S. and Chinese officials reaffirmed their commitment to a trade deal that had appeared on shaky ground because of worsening bilateral ties following weeks of escalating tensions between the world's two largest economies.

The euro rose and gold prices fell as positive signals on the Washington-Beijing trade front bolstered risk sentiment and offset support for the metal from a weaker dollar.

Trading volume was typically low for late August and investors await a speech by Federal Reserve Chairman Jerome Powell on Thursday, when he is expected to address the U.S. central bank's view on inflation and monetary policy.

"As the U.S. equity market continues to climb to all-time highs with the usual suspects leading the way (e.g. Tech, Communication Services and Amazon), we expect the momentum to continue," said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina.

"As the Federal Reserve's liquidity has provided fuel for the fire, the concentration of the top five largest stocks in the S&P 500 index gives us some pause," Zaccarelli added.

Powell may signal a shift in the Fed's inflation target to an average, which would allow inflation to rise more quickly than in the past.

On Wall Street, trading was mixed with the S&P 500 <.SPX> up 0.36%, the Nasdaq Composite <.IXIC> adding 0.76%, both hitting all-time closing highs.

The Dow Jones Industrial Average <.DJI>, which has yet to reclaim its February high, ended the session lower, however, falling 0.21%.

A slide of 0.82% in Apple Inc. , whose market capitalization of $2.15 trillion is greater than all the components in the benchmark FTSE 100 <.FTSE> index in London, initially kept stocks from rising.

A survey from the Conference Board showed U.S. consumer confidence unexpectedly fell in August to hit a six-year low.

Australian S&P/ASX 200 futures were down 0.55%, while Japan's Nikkei 225 futures were up 0.09%. Hong Kong's Hang Seng index futures <.HSI> <.HSIc1> were up 0.1%.

Emerging market stocks rose 0.59%.

Investors have also cheered signs researchers might be closer to a treatment for coronavirus.

British drugmaker AstraZeneca has begun trials of its antibody-based drug for the treatment and prevention of COVID-19, the latest development in a global race to combat the pandemic.

The dollar index <=USD> fell 0.274%, with the euro down 0.03% to $1.183.

The Japanese yen strengthened 0.03% versus the greenback at 106.36 per dollar, while Sterling was last trading at $1.3146, down 0.03% on the day.

Crude oil prices rose, supported by production cuts in the U.S. Gulf Coast as Tropical Storm Laura was forecast to become a major hurricane, while rising coronavirus cases in Asia and Europe capped gains.

U.S. crude recently rose 0.09% to $43.39 per barrel and Brent was at $46.05, up 2.04% on the day.

Longer-term U.S. Treasury yields rose as traders moved into riskier asset classes on reassurance that a U.S.-China trade deal would continue. Yields on the benchmark 10-year Treasury note rose 0.6883%, from 0.682%.

Spot gold added 0.1% to $1,928.83 an ounce. U.S. gold futures % to $1,911.80 an ounce.

(Reporting by Katanga Johnson; Editing by Sam Holmes)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

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
World

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.