BEIJING (AP) — Asian stocks rose while European markets opened lower yesterday after Washington and Beijing announced a truce on tariff hikes in a trade war.
London and Frankfurt declined while Shanghai and Hong Kong gained. Japanese markets were closed for a holiday.
United States (US) President Donald Trump agreed on Friday to put off planned tariff hikes this week on Chinese goods in a fight over Beijing’s trade surplus and technology plans. In exchange, he said China would buy American farm goods. But the two sides reported no progress on basic disputes that sparked the 15-month-old fight that threatens global economic growth.
Friday’s truce “has simply temporarily halted the escalation in China-US trade tensions,” Philip Wee and Eugene Leow of DBS Group said in a report.
“Longer-term concerns remain that the trade war may widen from tariffs towards impeding investment flows,” they said. The truce “could also see the Trump administration turning its tariff war towards the Eurozone.”
In early trading, London’s FTSE 100 declined 0.4 per cent to 7,217.36 and Frankfurt’s DAX lost 0.5 per cent to 12,443.99. France’s CAC 40 retreated 0.6 per cent to 5,628.69.
“It can be argued that the gains in global stocks were disproportionate to the (US-Chinese) compromise that was reached and European stocks are duly pushing lower this morning,” said Rabobank in a report.
On Wall Street, futures for the benchmark Standard & Poor’s 500 index and Dow Jones Industrial Average were unchanged.
In Asia, the Shanghai Composite Index rose 1.1 per cent to 3,007.88 and Hong Kong’s Hang Seng advanced 0.8 per cent to 26,521.85. Seoul’s Kospi added 1.1 per cent to 2,067.40.
Sydney’s S&P-ASX 200 gained 0.5 per cent to 6,642.60 and India’s Sensex rose 0.9 per cent to 38,477.16. Benchmarks in Taiwan, New Zealand and Southeast Asia also advanced.
Also yesterday, China reported exports to the US fell 17.8 per cent in September from a year earlier to USD36.5 billion. Imports of American goods sank 20.6 per cent to USD10.6 billion.
China’s global exports fell 1.4 per cent to USD218.1 billion. Imports fell 5.8 per cent to USD178.5 billion. On Friday, the S&P 500 ended with its first weekly gain in four weeks.
The S&P 500 added 1.1 per cent, while the Dow rose 1.2 per cent. The Nasdaq gained 1.3 per cent.
ENERGY: Benchmark US crude lost 40 cents to USD54.30 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained USD1.15 on Friday to close at USD54.70. Brent crude, used to price international oils, declined 48 cents to USD60.04 per barrel in London.
It advanced USD1.41 the previous session to USD60.51.
CURRENCY: The dollar declined to 108.25 yen from Friday’s 108.38 yen.
The euro slipped to USD1.1030 from USD1.1036.