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Global shares push higher on hopes of trade deal and China stimulus – business live | Business

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. The waiting game continues for the US-China trade deal. Chinese state media described the latest discussions, held by phone over the weekend, as “constructive,” but a report from CNBC suggested yesterday that the mood in Beijing

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

The waiting game continues for the US-China trade deal. Chinese state media described the latest discussions, held by phone over the weekend, as “constructive,” but a report from CNBC suggested yesterday that the mood in Beijing was pessimistic. Doubts have crept in over whether a preliminary deal can be struck, and when.

Vishnu Varathan, head of economics and strategy at Mizuho Bank’ Asia Treasury Department in Singapore, told Reuters:


There are some lingering doubts over whether a phase one deal can be struck. The suspicion is that there’s a lot more wrinkles to iron out than initially thought.

In a positive sign, the Trump administration issued a new 90-day extension allowing US companies to continue to do business with China’s Huawei Technologies while US regulators work on rules on telecommunications firms that pose a risk to national security.

The trade war between the world’s two biggest economies has dragged on well for over a year. David Madden, market analyst at CMC Markets UK, says:


In the middle of next month, the Trump administration will introduce fresh tariffs on roughly $156bn worth of Chinese imports, unless something changes. Some traders are hoping phase one of the overall trade deal will be agreed upon by then so there will be no need to press ahead with new tariffs.

Mr Trump would like more concessions from China in relation to intellectual property rights, but for now he doesn’t want to reverse tariffs, but China are open to the idea of rolling back on the levies. The toing and froing of the trade spat will probably continue up until when the next round of US levies are set to kick in, and then we could see some constructive talks.

Asian stock markets are mixed – the Shanghai composite index gained 0.78%, Hong Kong’s Hang Seng rose 1.29% and the Australian market advanced 0.7%. Sentiment was lifted by hopes that Beijing will provide more stimulus after yesterday’s rate cut from the People’s Bank of China.

However, other markets are down – Japan’s Nikkei fell 0.53%, as exporters came under pressure from a firmer yen against the dollar, while the South Korean Kospi slipped 0.34%.

The pound has performed well as the Conservative Party is leading in the polls, and after Boris Johnson declared that all Tory candidates standing in next month’s election had promised to back the deal he brokered with the EU.

The pound is inching higher this morning, trading below $1.30 at $1.2959, following the prime minister’s speech at the CBI’s annual conference yesterday. He will square up to the Labour leader, Jeremy Corbyn, in the first televised election debate tonight at 8pm on ITV.

European stocks are expected to open slightly higher, close to the record highs struck recently.

Agenda

  • 11am GMT: CBI industrial trends (November)
  • Shadow chancellor John McDonnell speech on the economy in London
  • 1.30pm GMT: US Housing starts (October)



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Susan E. Lopez
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