BEIJING (AP) — China’s main stock index jumped to an eight-month high yesterday and other global markets advanced after US President Donald Trump agreed to postpone a tariff hike on Chinese goods.
In early trading, London’s FTSE 100 rose 0.4 per cent and Germany’s DAX gained 0.6 per cent following Trump’s announcement after talks on a fight over Beijing’s technology ambitions. Trump said the negotiations in Washington made “substantial progress”.
The Shanghai Composite Index rose 5.6 per cent to 2,961.28, its highest close since June 15.
Trump said he would postpone a March 1 deadline for 10 per cent punitive tariffs on USD200 billion of Chinese imports to rise to 25 per cent but set no new date.
The fight threatens to disrupt global trade and weigh on economic growth that shows signs of faltering. Investors also are watching February manufacturing indicators due out this week for signs of further deceleration in global activity.
Trump’s announcement should reassure financial markets, but stock gains might be limited because prices already had risen in expectation of such a move, analysts said.
“The latest news may not offer a significant boost to start the week,” Tai Hui of JP Morgan Asset Management said in a report. “Nonetheless, it helps to underpin positive investor sentiment.”
The FTSE 100 rose to 7,208.15 and the DAX advanced to 11,526.93.
Tokyo’s Nikkei 225 advanced 0.5 per cent to 21,528.23 while Hong Kong’s Hang Seng added 0.5 per cent to 28,959.30.
On Wall Street, the future for the Standard & Poor’s 500 index rose 0.3 per cent. That for the Dow Jones Industrial Average advanced 0.4 percent.
Seoul’s Kospi gained two points to 2,232.56. India’s Sensex advanced 0.5 per cent to 35,950.50 and Sydney’s S&P-ASX 200 rose 0.3 per cent to 6,186.30.
New Zealand, Taiwan and Southeast Asia advanced.
The world’s two biggest economies have raised tariffs on billions of dollars of each other’s goods in the fight over United States (US) complaints Beijing steals or pressures companies to hand over technology.
Washington wants China to roll back plans for government-led creation of global competitors in robotics and other technologies. Europe, Japan and other trading partners echo US complaints those violate Beijing’s free-trade obligations.