Asian Stocks Post Huge Rally After U.S., China Exchange ‘Goodwill Gestures’ – CCN.com
Asian stocks advanced on Friday after an apparent thawing in U.S.-China trade tensions fueled investors’ appetite for riskier assets.
In the process, the Chinese yuan stabilized at three-week highs against the U.S. dollar.
Asian Market Update
Markets across the Asia-Pacific region reported big gains in the final session of the week. In Japan, the benchmark Nikkei 225 index climbed 0.9% to 21,947.53, the highest in four-and-a-half months.
Mainland China’s Shanghai Shenzhen CSI 300 Index jumped 1.1% to 3,972.38.
The Hang Seng Index in Hong Kong added 0.2% to 27,144.48.
Chinese Yuan Strengthens Against the Dollar
The yuan rose against the dollar this week after President Trump agreed to delay additional tariff hikes on Chinese imports at the request of Vice Premier Liu He. The move, which was described by Liu “as a gesture of goodwill,” came after China announced it would delay duties on certain American-made imports.
Since Monday, the dollar-yuan exchange rate has fallen 0.5%.
For much of 2019, China has been devaluing its currency in response to escalating U.S. tariffs. Although the Chinese currency has strengthened this week, its free-fall is expected to continue. CLSA chief economist Eric Fishwick recently pegged USD/CNY as high as 7.3 by the end of the year.
China and the U.S. are set to resume face-to-face trade negotiations next month. Several contentious issues, like Chinese industrial policy and intellectual property, block the formation of a new trading agreement.
U.S. Futures Drift Higher
U.S. equity futures were slightly higher in overnight trading, with the Dow Jones Industrial Average (DJIA) on track to open positively in New York. Futures on the blue-chip index are up 32 points, or 0.1%, to 27,216.00.
The Dow is coming off its seventh straight positive session, the longest winning streak since early May.
S&P 500 futures edged up 0.1% to 3,017.00. Nasdaq futures climbed 0.2% to 7,956.00.
Last modified (UTC): September 13, 2019 3:27 AM