By Tom Westbrook and Lawrence Delevingne
SINGAPORE / BOSTON (Reuters) – Asian stock markets rose on Tuesday, relieved that another round of Sino-U.S. Fighting did not appear to have spilled over into trade, while hopes of a U.S. stimulus supported oil currencies and raw materials.
The largest MSCI index of Asia-Pacific stocks outside of Japan () was up 1% for the last time. Japan’s Nikkei () returned from vacation with a 1.7% gain led by health and industrial stocks and the Hang Seng () rebounded 2.2%.
The risk-sensitive Australian and New Zealand dollars each rose around 0.3%, although they are comfortably below recent milestone highs as some apprehension dampened their rise. [AUD/]
Investors are awaiting a meeting between top U.S. and Chinese trade officials on Saturday to review the first six months of the Phase 1 trade deal.
With China falling far behind in purchasing energy and agricultural products from the United States, it could test the markets hypothesis that trade relations are immune to the erosion of diplomatic relations between the United States. two countries.
Still, there was palpable relief on Tuesday that Chinese sanctions against 11 US citizens – a response to US sanctions against the Chinese over Beijing’s crackdown on Hong Kong – appeared to put an end to the latest round of titular moves. -for-tat.
“It left the White House untouched,” said Vishnu Varathan, head of economics at Mizuho Bank in Singapore.
“It gives some relief that China still gives some priority to the dialogue (on the trade deal),” he said. “It’s just the feeling that you don’t rock the boat to the point of capsizing, it’s low bar today. ”
Safe havens were under slight pressure in all areas. Gold
UP AND UP
Overnight, Wall Street found support after Trump signed executive orders to partially restore unemployment benefits after talks between the White House and the main Democrats over new stimulus measures collapsed last week .
The Dow () rose 1% and the S&P 500 () edged up, while the Nasdaq () sold off a bit as investors cut some tech holdings in favor of value stocks.
The S&P 500 is now less than 1% below a February record, while in Asia, the MSCI ex-Japan index is less than 2% from an all-time high in January.
These moves have pushed valuations in Asia to steep highs, around 20% above average after the financial crisis. But Jim McCafferty of Nomura in Hong Kong said the high levels are justified by a huge shift in investor preferences.
“The composition of stock indices in the region has changed dramatically,” he said. “Oil, telecom operators and banks dominated… now it’s the Internet and technology. ”
Futures on S&P 500 () rose 0.3% and oil traded firmly on the hope that a US stimulus deal could still be reached and the anticipation of growing demand in Asia . [O/R]
Brent futures () last rose 0.4% to $ 45.16 a barrel and US crude () rose 0.6% to $ 42.18.
Besides the and, other major currencies made very marginal gains against the dollar while the yen fell slightly.
The euro () last bought $ 1.1746 and the yen
Chinese credit figures are due this week, while UK labor data and a German sentiment survey due at 8:30 GMT and 9:00 GMT respectively will provide the latest readings on the recovery in Europe.
Investors expect UK unemployment to hit 4.2% in June and German economic sentiment to hold broad overall.