Global stocks rise ahead of US-China trade pact signing

BEIJING (AP) — Global stock markets rose yesterday ahead of the signing of an interim United States (US)-Chinese trade pact as investors shrugged off weaker-than-expected American jobs data.

London and Frankfurt rose in early trading while Shanghai, Hong Kong and South Korea finished higher. Japanese markets were closed for a holiday.

Investors expressed little concern over Friday’s data showing American employers added fewer jobs than forecast in December. Concern over a potential US-Iranian conflict faded.

Traders looked ahead to this week’s signing of the interim US-Chinese trade deal, which they hope will be a step toward ending a tariff war that threatens to drag down global economic growth.

Markets start the week “on a cautiously optimistic tone” as investors look ahead for the possibility of further US-China trade progress, Mizuho Bank said in a report.

The ‘Phase 1’ agreement has helped ease market jitters, though economists warn it leaves major disputes unresolved and the outlook for negotiations is unclear.

“Thornier issues such as enforcement may come back to haunt further negotiation progress,” Mizhuo Bank warned.

A currency trader watches computer monitors at the foreign exchange dealing room in Seoul, South Korea yesterday. PHOTO: AP

Investors also were encouraged by US President Donald Trump’s decision to resume a regular trade policy dialogue with Beijing that Washington pulled out of in July 2017.

London’s FTSE 100 opened 0.6 per cent higher at 7,630.79 and Frankfurt’s DAX gained just under 0.1 per cent to 13,494.39. France’s CAC 40 added 0.3 per cent to 6,057.14.

On Wall Street, futures for the benchmark S&P 500 index and Dow Jones Industrial Average were up 0.4 per cent.

On Friday, US stocks retreated from record highs after the Labour Department reported employers added 145,000 jobs last December, short of the 160,000 forecast. The S&P 500 and Nasdaq composite both lost 0.3 per cent while the Dow ended down 0.5 per cent.

In Asia, the Shanghai Composite Index gained 0.7 per cent to 3,115.57 and Hong Kong’s Hang Seng rose 1.1 per cent to 28,954.94. Seoul’s Kospi advanced one per cent to 2,229.26.

Sydney’s S&P-ASX 200 shed 0.4 per cent to 6,903.70 while India’s Sensex added 0.6 per cent to 41,859.69. Taiwan advanced while Singapore and New Zealand retreated.

Under the “Phase 1” trade pact due to be signed on Thursday, Washington postponed planned tariff hikes and Beijing agreed to buy more American farm exports.

Details have yet to be released. Economists warn key hurdles including Beijing’s insistence that Washington role back punitive tariffs on Chinese goods have yet to be resolved.

The chief American negotiator, Robert Lighthizer, said Beijing agreed to make changes to address US complaints that it steals or pressures companies to hand over technology. Chinese officials have yet to confirm that.


Benchmark US crude shed two cents to USD59.02 per barrel in electronic trading on the New York Mercantile Exchange. The contract lost 52 cents last Friday to close at USD59.04. Brent crude, used to price international oils, lost five cents to USD64.93 per barrel in London. It declined 39 cents the previous session to USD64.98.


The dollar gained to JPY109.90 from last Friday’s JPY109.46. The euro declined to USD1.1119 from USD1.1123.