SINGAPORE (AP) – World markets were mostly higher yesterday after China-United States (US) trade talks ended in Washington with expectations for a second meeting between Presidents Donald Trump and Xi Jinping. But gains were capped by weak manufacturing data for China.
KEEPING SCORE: Germany’s DAX added 0.2 per cent to 11,206.88 and France’s CAC 40 rose 0.3 per cent to 5,007.34. Britain’s FTSE 100 advanced 0.4 per cent to 6,997.82. Wall Street was set for an optimistic open. The future contract for the Dow Jones Industrial Average added 0.2 per cent to 25,024.00. S&P 500 futures gained 0.1 per cent to 2,706.30.
THE DAY IN ASIA: Hong Kong’s Hang Seng index was flat at 27,930.74 while the Shanghai Composite index jumped 1.3 per cent to 2,618.23. Japan’s Nikkei 225 index rose less than 0.1 per cent to 20,788.39 after the country’s unemployment rate unexpectedly fell to 2.4 per cent in December last year from 2.5 per cent the month before. South Korea’s Kospi was down 0.1 per cent at 2,203.46. Australia’s S&P ASX 200 edged 0.1 per cent lower to 5,862.80. Shares rose in the Philippines and Thailand but fell in Singapore. Markets in Taiwan were closed.
CHINA-US TALKS: American and Chinese negotiators wrapped up two days of talks Thursday without a deal but with an upbeat outlook. Trump said China has agreed to buy more American soybeans, but he expects to meet Xi to seek agreement on other contentious issues. “There are some points we don’t agree to, but we will agree,” Trump said. “I think when Xi and I meet, every point will be agreed to.” A tariffs cease-fire between the US and China is set to end on March 2, and the US is expected to raise import taxes from 10 per cent to 25 per cent for USD200 billion in Chinese goods.
CHINESE MANUFACTURING: A private survey suggested manufacturing in China slowed in January. China’s Caixin Manufacturing PMI was 48.3 in January, down from 49.7 in December. This was its lowest reading since February 2016. Readings below 50 indicate contraction on the index’s 100-point scale. The survey said Chinese production and new orders slipped further in January while export orders climbed, fuelling fears that the world’s second-largest economy was experiencing a slowdown.
ANALYST’S TAKE: “The terrible decline in the Caixin PMI index … shows just how important it is for China and the US to secure a trade deal. If nothing else, a deal should prevent the near-term imposition of higher tariffs,” Robert Carnell of ING Bank said in commentary.
ENERGY: Benchmark US crude dropped 33 cents to USD53.46 per barrel in electronic trading on the New York Mercantile Exchange. It lost 44 cents to settle at USD53.79 per barrel on Thursday. Brent crude, used to price international oils, lost 24 cents to USD60.60 per barrel. The contract dropped 70 cents to USD60.84 per barrel in London.