Stocks, U.S. bond yields rise as trade row fails to dent confidence

By Shinichi Saoshiro TOKYO (Reuters) - Asian stocks rose and U.S. Treasury yields hovered near four-month highs on Wednesday, as investors looked past the latest escalation in the U.S.-China trade conflict, seen by some market participants as less severe than expected.

Reuters September 19, 2018 07:05:20 IST
Stocks, U.S. bond yields rise as trade row fails to dent confidence

Stocks US bond yields rise as trade row fails to dent confidence

By Shinichi Saoshiro

TOKYO (Reuters) - Asian stocks rose and U.S. Treasury yields hovered near four-month highs on Wednesday, as investors looked past the latest escalation in the U.S.-China trade conflict, seen by some market participants as less severe than expected.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> rose 0.15 percent.

Australian stocks <.AXJO> added 0.35 percent, South Korea's KOSPI <.KS11> climbed 0.1 percent and Japan's Nikkei <.N225> rose 1.45 percent.

Equity markets in Asia took their cues from Wall Street, which posted a broad-based rally on Tuesday amid emerging views that the U.S.-China trade dispute's impact on world growth might not be as heavy as previously feared.

"The broader equity markets are able to regroup now that the latest phase of the U.S.-China trade war is over," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management in Tokyo.

"There was relief as the United States set the initial tariffs at 10 percent, rather than the expected 25 percent, seen by some as a gesture that it was buying time for further negotiations."

On Monday, the U.S. administration said it will begin to levy new tariffs of 10 percent on $200 billion of Chinese products on Sept. 24, with the tariffs to go up to 25 percent by the end of 2018. China said it will levy tariffs on about $60 billion worth of U.S. goods, as previously planned, but cut the tariff rates.

Safe-haven U.S. Treasuries were sold and their yields rose on the back of improved investor risk appetite.

The benchmark 10-year Treasury yield stood at 3.055 percent after touching 3.059 percent overnight, its highest since May 23.

The rise in yields propped up the dollar in turn. The greenback climbed to a two-month high of 112.395 yen overnight and last traded at 112.300.

China's yuan was a shade firmer at 6.858 per dollar in offshore trade after edging up 0.15 percent on Tuesday.

The Australian dollar, seen as a gauge of risk sentiment, edged up to a two-week peak of $0.7235 after advancing nearly 0.6 percent on Tuesday.

The euro was flat at $1.1671 .

The pound shook off modest overnight losses and rose to $1.3175 , its highest since July 26. Growing confidence that London and Brussels can secure an agreement has encouraged investors to buy into the British currency.

Crude oil prices consolidated after rallying the previous day on signs that OPEC would not be prepared to raise output to address shrinking supplies from Iran, and as Saudi Arabia signalled an informal target near current levels. [O/R]

U.S. crude futures was 0.25 percent lower at $69.69 a barrel after surging 1.4 percent on Tuesday.

(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.