Asian stock open mostly higher on trade deal optimism

Economies.com
2019-12-13 04:29AM UTC

Asian stocks opened on Friday mixed but mostly positive, with the Japanese, Australian and the Chinese stocks rose, in addition to Hong Kong's Hang Seng and the South Korean Kospi index, while the New Zealand stocks fell, which came after news reports that President Donald Trump had signed the phase one of the US trade deal with China in efforts to end the ongoing trade war between the two countries.

 

President Trump tweeted yesterday the US is very close to reaching a big trade deal with China, which came prior to report that the US trade negotiators presented the draft for the phase one trade deal with China to Trump, including Beijing's commitment to expand its purchases of US farm goods.

 

The reports also touched that the US will rollback the imposed tariffs on Chinese imports, which also means that Washington will not activate the tariffs hike of 15% on Chinese goods worth $156 billion, which was scheduled to enter into force by next Sunday.

 

Similarly, Most FOMC members expect that the Fed's monetary policy will not change in the next year, and Fed chief Powell stated after the meeting that the central bank could potentially expand treasury bills purchasing program if necessary, to increase liquidity in the thirsty financial system.

 

Which came after the US Treasury Department launched a program in October of bill purchases of $60 billion per month, and the Federal Reserve praised the program amid forecasts that it will continue until the end of June next year, aimed at providing liquidity after interest rates in repo operations rose, leading the Fed to increase repo operations in the last two months, which is the purchase of bonds and short-term debt from banks and hedge funds to increase their funding reserves.

 

Otherwise, investors' focus turned to the European Central Bank meeting and the British general election, which is a very important step in Britain's exit file from the EU. The markets are also anticipating the US-China trade talk news and developments, as the US deadline for imposing tariffs on Chinese imports worth $156 billion is approaching without reaching any results in the trade talks to complete the phase one of the trade deal, bearing in mind that the US Senator Chuck Grassley said yesterday that additional tariffs will not be imposed.

 

As for trading, Japanese stock indices were higher during today's session, as the Topix index rose by 1.80% or 30.83 point to 1,743.66, and Nikkei 225 index rose by 2.57 % or 601.64 points to 24,026.45.

 

The Chinese stocks also rose, as the CSI 300 index rose by 1.38% or 53.87 points to 3,944.89, and the Shanghai Composite index fell 1.24% or 36.03 points to 2,951.73.

 

Hong Kong's Hang Seng Index rose by 1.98% or 534.94 points to 27,528.63, and South Korea's Kospi rose 1.37% or 29.19 points to 2,166.54.

 

To New Zealand's NZX 50, which fell by 0.76% or 86.50 points to 11,221.48, while Australia's S&P/ASX 200 index rose by 0.51% or 34.47 points to 6,743.30.

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