Asian equities swing as trade cues awaited

Hong Kong, Nov 14 (AFP/APP): Asian markets fluctuated Thursday following another Wall Street record as Donald Trump hailed progress in US-China trade talks, while eyes were also on Hong Kong as violent protests continued.

Trading floors were edgy, with very few details from Washington and Beijing on negotiations for their mini tariffs agreement.

Trump’s comments on Wednesday that “our trade agreement with China is moving along very rapidly” provided some support, though observers said markets were looking for something more concrete to buy into.

“Let’s not forget that as long ago as June we were told that a US-China trade deal was 90 percent of the way there,” said Michael Hewson, chief market analyst at CMC Markets UK.

“Yet since then we’ve seen new tariffs applied to Chinese goods, albeit with some exemptions, with a new set of tariffs still expected to kick in on December 15.”

Equities have seen healthy rallies in recent weeks on optimism the two sides would soon reach a partial deal as part of a wider agreement to end a long-running trade war that has hit the global economy.

Michelle Girard, chief US economist at NatWest Markets, told Bloomberg TV: “We’ve been pushing back on a lot of this trade optimism and it’s felt kind of lonely because markets have certainly embraced the news that we might have a short-term deal.

“We are not there yet.”

Adding to the unease was a report that China was hesitating over aspects of the deal, which came after Trump dismissed Beijing’s claims last week they had a plan to roll back some tariffs as the talks progressed.

Tokyo stocks open lower after weak growth data

– Fresh Hong Kong unrest –

Tokyo fell 0.8 percent after data showed Japan’s economy grew at a slower pace than forecast in the third quarter as it was hit by trade wars.

Taipei eased 0.2 percent, Manila dropped 0.6 percent, Singapore shed 0.3 percent, Jakarta sank more than one percent and Mumbai was flat.

But Shanghai added 0.2 percent as dealers brushed off fresh data pointing to weakness in the Chinese economy. Retail sales, fixed-asset investment and industrial production figures all missed expectations as the country is weighed by the trade war and slowing global demand.

Sydney rose 0.6 percent, Seoul edged up 0.4 percent and Wellington put on 0.6 percent.

Hong Kong tumbled 0.9 percent following another night of unrest in the city, which has seen a pick-up in violence since the weekend, while on Thursday protesters blocked roads in certain districts — closing businesses — and disrupted public transport for a fourth day.

The standoff has hammered the Hang Seng Index — which had lost around four percent by Wednesday night — while there are concerns about possible intervention by Beijing. Property firms were again in the firing line, with big-names including Henderson Land and Sun Hung Kai Properties down around one percent.

There was little reaction to the head of the Federal Reserve saying he did not expect the central bank to lift interest rates for a fourth time this year, and that the economy would probably continue to grow but faced risks from a global slowdown and trade disputes.

In the first of two days of congressional testimony, Jerome Powell also urged lawmakers to take action on the rising US debt and deficit to ensure continued growth.

On currency markets, the Chilean peso was sitting at a record low 795 to the dollar, forcing the country’s central bank to pump $4 billion into financial markets for support.

The unit has been battered by nearly four weeks of protests against the economic policies of right-wing President Sebastian Pinera.

The euro was inched up against the pound and dollar followig data showing Germany, the European Union’s biggest economy, had averted a recession in the third quarter.

In early trade London dipped 0.1 percent, Paris was flat and Frankfurt shed 0.2 percent.

– Key figures around 0820 GMT –

Tokyo – Nikkei 225: DOWN 0.8 percent at 23,141.55 (close)
Hong Kong – Hang Seng: DOWN 0.9 percent at 26,323.69 (close)
Shanghai – Composite: UP 0.2 percent at 2,909.87 (close)
London – FTSE 100: DOWN 0.1 percent at 7,341.62
Pound/dollar: DOWN at $1.2839 from $1.2849 at 2130 GMT
Euro/pound: UP at 85.77 pence from 85.64 pence
Euro/dollar: DOWN at $1.1010 from $1.1004
Dollar/yen: DOWN at 108.72 yen from 108.84 yen
West Texas Intermediate: UP 39 cents at $57.51 per barrel
Brent North Sea crude: UP 37 cents at $62.74 per barrel
New York – Dow: UP 0.3 percent at 27,783.59 (close)