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Friday, 08 Nov 2019 01:36 pm

Asian shares ease from six-month highs on U.S.-China trade angst

Asian stocks retreated from six-month highs on Friday as conflicting signals from China and the United States on progress made in trade talks deflated market hopes of a near term truce to end their damaging tariff war.


In a sign of the anxiety, the pan-region Euro Stoxx 50 futures and German DAX futures eased 0.35% each in early European trading while London’s FTSE futures slipped 0.24%. E-mini futures for the S&P 500 were down 0.3%.

The moves contrast with Thursday’s surge of optimism in global markets on news Beijing and China have agreed to roll back tariffs on each others’ goods as part of the first phase of a trade deal.

MSCI’s gauge of Asia-Pacific shares outside Japan was off 0.4% at 535.20 points after rising to 538.77, a level not seen since early May. For the week, it is so far up about 2%.

Tokyo’s Nikkei, which earlier in the day climbed to a 13-month high, gave up some of the gains to be last up 0.26%. Chinese shares also reversed course from earlier gains with the blue-chip index flat. Hong Kong’s Hang Seng index slipped 0.6%.

“The noise coming from Washington DC was not quite so upbeat, with reports of conflicts amongst White House advisors on the merits of the plan,” said Jeffery Halley, senior market analyst at OANDA.

“That said, despite the lack of detail and a concrete timeline for even signing an interim trade deal, progress does at least appear to be being made. As ever, the caveat here is the unpredictable nature of the White House.”

In commodities, prices for livestock and grains, which have been highly sensitive to any the trade tensions, were subdued across the board.

Soybean futures were little changed on lack of follow-through interest after rallying as much as 1% on Thursday.

Prices of lean hogs, which are expected to be in high demand in China amid a deadly swine fever outbreak, also managed only modest gains before settling near recent lows on Thursday.

Crude oil was also lower with U.S. West Texas Intermediate (WTI) crude losing 22 cents to $56.93 per barrel. Brent was down 11 cents at $62.18.

Safe haven gold, which tends to rise during times of uncertainty, was a tad firmer at $1,469.2 per ounce, having hit a five-week low of $1.460.7 on Thursday.

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Tags Asia Stock Market US-China Trade War Asia-Pacific

Meeta Ramnani

Meeta develops credible content about various markets based on deep research, opinions from experts and inputs from industry leaders. As the managing editor at Smart Market News, she assures that every piece of news and article adds to the knowledge of decision makers. An avid bike rider, Meeta, is a postgraduate from Indian Institute of Journalism and New Media (IIJNM) Bangalore, where her specialization was Business Journalism. She carries experience from mainstream print media including The Times Group and Sakal Media Group.

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