Asian Shares Rise on Optimism About U.S.-China Trade Deal

TOKYO (AP) -
Currency traders work at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday. (AP Photo/Ahn Young-joon)

Asian shares were mostly higher Thursday amid renewed hopes a U.S. trade deal with China may be near, despite recent tough talk from President Donald Trump.

Japan’s benchmark Nikkei 225 gained 0.7% to 23,300.09, while Australia’s S&P/ASX 200 added 1.2% to 6,683.00. South Korea’s Kospi fell 0.4% to 2,061.04. Hong Kong’s Hang Seng was up 0.4% at 26,164.62, while the Shanghai Composite rose 0.6% to 2,895.77.

Shares on Wall Street finished higher, with gains snapping a three-day losing streak for the S&P 500. The U.S. market has swung sharply for months on every hint of progress about talks between the world’s largest economies, and Asian regional indexes have tended to reflect those fluctuations.

In the latest development, Bloomberg News reported that U.S. negotiators expect a “Phase 1” trade agreement to be completed before U.S. tariffs are set to rise on Chinese products Dec. 15.

The report came a day after Trump said he wouldn’t mind waiting until after the 2020 elections for a deal, a remark that officials reportedly called off the cuff but nevertheless sent markets skidding.

“The trade war will be the key driver of sentiment in the immediate few weeks,” DBS Group analysts wrote in a report.

The S&P 500 rose 0.6% to 3,112.76. Despite recovering some losses, the index is still down 0.9% for the week.

The Dow Jones Industrial Average climbed 0.5% to 27,649.78. The Nasdaq composite gained 0.5% to 8,566.67. The Russell 2000 index of smaller company stocks picked up 0.7%, to 1,613.90.

Reaction was muted to reports by Kyodo and other Japanese media that Tokyo plans a 26 trillion yen ($239 billion) stimulus package to prop up growth, following an October sales tax hike.

The package, set to be approved later in the day, includes 13 trillion yen ($119 billion) of government spending and the remainder coming from the private sector, the reports said.