Asian stocks open higher by 1% on US-China trade talks hopes

2019-06-19 09:24:49 GMT (
Asian stocks open higher by 1% on US-China trade talks hopes

Asian stocks opened the third session of the week on green, buoyed by market optimism that the US and China will resume trade talks ahead of a meeting between US President Donald Trump and his Chinese counterpart Xi Jinping during the G20 summit next week to discuss trade ties, this followed the ECB Governor expressing willingness to adopt stimulus.


Trump said through his Twitter account "We will have an extended meeting next week in the G20 in Japan," he said. "Our teams will talk before our meeting," Which boosted the hopes of investors about a resolution to the trade disputes between the world's two largest economists to end the trade war between them.


In another context, we also followed yesterday the ECB Governor Mario Draghi saying that the central bank's monetary policy makers is ready to adopt further stimulus if necessary, thus enhancing the chances for the ECB to expand monetary policy by next July's meeting In the shadow of inflationary pressures in the euro area, to stimulate the cycle of risk appetite in the markets.


In contrast, US President Trump commented, "Mario Draghi has just announced that more stimulus will come, which has led to the euro immediately falling against the dollar, making it unfairly easy for them to compete against the United States, as the have done for years, along with China and others,"  amid the proceedings of the Federal Open Market Committee meeting on June 18-19 in Washington.


Investors are anticipating the FOMC meeting decision, where interest rates are expected to remain between 2.25% and 2.50%, as markets look for a reveal of the committee forecasts for growth, inflation and unemployment as well as the future interest rates for the next three years ahead of Fed Chairman Jerome Powell's upcoming press conference later in the day.


We would like to point out that US Federal Reserve Governor Paul Powell recently expressed his belief that the Fed does not know how and when trade tensions will be resolved, considering that the Federal Commission takes inflationary pressures impacts seriously for an extended period which may affect the committee's inflation forecasts later, which boosted prospects that the Federal Reserve will abandon its policy of patience and reduce interest on federal funds in the coming period.


The Japanese stocks rose during today's trading session, with the broader Topix index rising by 1.54% to win 23.52 points up to the level of 1,552.19, Nikkei 225 rose by 1.66% to win 348.46 points up to 21,321.17 level.


China's benchmark index CSI 300 rose by 1.75% to 64.07 points to reach 3,731.69. The Shanghai Composite Index rose 1.23% to 35.59 points, reaching 2,925.75 points.


Hong Kong's Hang Seng Index gained 2.34% (643.47 points) reaching 28,142.24. The South Korean Kospi Index rose 0.95%, gaining 19.95 points to 2,118.66.


To New Zealand's NZX 50 index, which gained 1.02% (104.28 points) to 10,295.61. On the other hand, Australia's S&P/ASX 200 index rose 1.00% (65.60 points) to 6,635.60.

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