Asia markets: US-China trade negotiations

Asia Pacific markets rose on Monday as investor sentiment improved following last week’s high-level trade negotiations between the United States and China.Mainland Chinese markets traded up: The Shanghai composite added 1.07%, the Shenzhen composite rose 1.48% and the Shenzhen component added 1.48%.Customs data showed that China’s yuan-denominated exports for September fell 0.7% on-year while imports declined 6.2%, Reuters reported. That left China with a trade surplus of 280 billion yuan ($39.58 billion) and Beijing’s total trade in yuan terms with the United States dropped 10.3% from a year earlier in the January-September period, according to the Reuters report.Hong Kong’s Hang Seng index rose 1.05%. In South Korea, the Kospi index gained 1.34%, with major chipmakers Samsung and SK Hynix advancing 2.34% and 1.75%, respectively. Last week Samsung announced profit guidance for its third quarter at a level slightly better than what market watchers were predicting — full results are due later this month.In Australia, the benchmark ASX 200 rose 0.72%, with the heavily weighted financial subindex gaining 0.95%. The country’s so-called Big Four banks advanced: ANZ shares rose 1.05%, Commonwealth Bank was up 0.56%, Westpac added 0.87% and the National Australia Bank gained 0.92%.Markets in Japan are closed for a public holiday. Asia-Pacific Market Indexes ChartTrade optimismU.S. Treasury Secretary Steven Mnuchin said last Friday tariffs on $250 billion worth of Chinese imports that were set to rise from 25% to 30% on Oct. 15 will not go into effect. That followed an announcement from U.S. President Donald Trump that both sides reached a “very substantial phase one deal” that will address intellectual property and financial services concerns, and include purchases of about $40 billion to $50 billion worth of agricultural products by China.Citi analysts pointed out that during normal times, China’s purchase of U.S. agricultural products was about $20 billion, which makes the numbers Trump announced appear “overly large.””Despite what appears to have been achieved in the October talks, we remain cautious on an eventual trade deal,” the analysts wrote in a note. “The US offers are far from what China has been demanding, as showcased in its June State Council White Paper: reasonable purchases of US imports, removal of existing tariffs, and giving the trade document a balanced treatment.”They added that Washington’s decision to not raise an additional 5% tariffs on $250 billion of Chinese exports to the U.S. this week will “have little impact on the Chinese economy at the margin given the tariff impact has mostly played out.”Currencies and oilThe U.S. dollar traded at 98.422 against a basket of its peer, after declining from levels above 98.700 in the previous week.Elsewhere, the Japanese yen, which is seen as a safe-haven currency, changed hands at 108.27. It weakened from levels below 107.00 last week as risk sentiment improved following the announcements from the U.S.-China trade negotiations. The Australian dollar traded at $0.6784, climbing from an earlier low of $0.6775.Oil prices slipped on Monday: U.S. crude futures fell 0.46% to $54.45 per barrel while global benchmark Brent shed 0.4% to $60.27.Prices rose almost 2% on Friday after an Iranian oil tanker was attacked off Saudi Arabia’s coast in the Red Sea, which stoked geopolitical tensions in the Middle East.

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