Donald Trump’s announcement to meet with China’s trade negotiator created quite a stir in the Asian stock market, as numbers soared on Friday owning to optimism over the likelihood of a Brexit deal.
As for the European shares they continued the rally, when early in the day, German DAX futures gained 0.29 per cent to 12,209, Pan-region Euro Stoxx 50 futures climbed 0.26 per cent to 3,494 and FTSE futures dropped 0.43 per cent at 7,142.5.
Furthermore, MSCI’s broadcast index of Asia-Pacific shares outside Japan increased 1.3 percent on Friday afternoon in the Asian region. S&P e-mini futures also added 0.45 percent.
Australian shares also experienced a surge of 0.9 percent, whereas Japan’s Nikkei stock index fostered 1.1 percent and Chinese blue chips after experiencing a slow start went up to nearly 1 percent.
The trade talks between U.S. and China is attributed to be the major reason for causing the sensation in the stock rates. A statement released by a White House official said the talks went "probably better than expected", this as a result also increased the possibility of a currency agreement in this week.
Sources however allege, figures on US markets soared even before the agreement was reached. While the S&P 500 gained 0.64 per cent, Dow Jones Industrial Average added 0.57 per cent, and the Nasdaq Composite rose 0.6 per cent.
Referring to the stock market situation, Matt Simpson said optimism on the trade talks was responsible for a “classic risk on session” overnight. "We know that it's just a few words from Trump," he claimed at GAIN Capital in Singapore.
Positive trade talks could foster growth on Monday, however lack of agreement would not "necessarily (be) the end of the world for risk," Simpson added.
According to reports, analysts at National Australia Bank freezing tariffs at the current levels were unlikely to reverse trade-driven slowdown in economic growth. "The uncertainty around unresolved structural issues such as IP (intellectual property) theft and subsidies to state owned enterprises are likely to remain deterrents for a pick-up in much needed capital expenditure. On this score details on a potential currency pact will be important," as per the statement by analysts.
While the Dollar had only changed a little as opposed to Yen at 107.98, the Euro rose 0.1 percent to buy $1.1017. The Pound which had grown higher previously, rose higher by adding 0.1 percent to $1.2455.
As quoted by the Irish Prime Minister, Leo Varadkar, the British pound had gained the highest since March by climbing nearly 2 percent.
Tags : Donald Trump, China trade, MSCI, Dow Jones, GAIN Capital , Singapore,