· Asian stocks climb after volatile trade on U.S.-China trade confusion
Asian equity markets bounced on Tuesday after U.S. President Donald Trump said the U.S.-China trade pact was “fully intact”, clarifying earlier confusing statements from the White House over the fate of the deal.
MSCI’s broadest index of Asia Pacific shares outside of Japan rose 0.72% to 517.1 points after earlier going as low as 509.9. Chinese shares regained lost ground too, with the blue-chip index last up 0.38%.
Jitters emerged early in the Asian day after White House trade adviser Peter Navarro said the trade deal with China was “over”, linking the breakdown in part to Washington’s anger over Beijing not sounding the alarm earlier about the coronavirus outbreak.
The statement prompted a selloff across equities markets but sentiment quickly recovered when Navarro, an outspoken critic of China, said his remarks had been taken out of context.
Trump also soothed nerves when he tweeted: “China trade deal is fully intact. Hopefully they will continue to live up to the terms of the agreement.”
Asian stocks have rallied hard since hitting a low in March amid worries about the jolt to the global economy from the coronavirus-driven shutdown.
Ord Minnett investment advisor John Milroy said equity market sentiment was positive despite ongoing bursts of volatility across regional markets.
· Tokyo stocks end higher after wild swing on US-China trade comment
Tokyo stocks ended higher Tuesday following a wild swing triggered by a White House advisor's comment suggesting a U.S. trade deal with China was "over" before he quickly claimed it had been taken out of context.
The 225-issue Nikkei Stock Average ended up 111.78 points, or 0.50 percent, from Monday at 22,549.05. The broader Topix index of all First Section issues on the Tokyo Stock Exchange finished 8.05 points, or 0.51percent, higher at 1,587.14.
Gainers were led by transportation equipment, warehousing and harbor transportation service, and rubber product issues.
· China shares end higher as Trump reassures on trade deal
Chinese shares ended higher on Tuesday, as investors were reassured by U.S. President Donald Trump’s assertion that the trade deal between China and the United States remains in place.
At the close, the Shanghai Composite index was up 0.18% at 2,970.62. ** The blue-chip CSI300 index was up 0.48%, with its financial sector sub-index lower by 0.16% and the real estate index down 0.55%.
Both indexes fell in early trade after White House trade adviser Peter Navarro said on Fox News that the trade deal between Washington and Beijing was “over.”
But after his comments stoked market volatility, Navarro said the trade deal with China “continues in place,” while U.S. President Donald Trump said in a tweet the deal with China was “fully intact.”
· European stocks open higher, brushing off concerns over U.S.-China trade deal and coronavirus
European stocks opened higher Tuesday despite some concerns over the state of the U.S.-China trade deal, and a surge of coronavirus cases in the U.S. and elsewhere.
The pan-European Stoxx 600 added 0.6% in early trade, with financial services, industrials and tech stocks each climbing more than 1% as all sectors and major bourses entered positive territory.
European markets look set to follow their global counterparts Tuesday. The boost to stocks comes after White House trade advisor Peter Navarro clarified that the U.S.-China trade deal is not over, following an interview with Fox News in which he appeared to suggest otherwise, prompting U.S. stock futures to plunge.
Later, Navarro clarified that the U.S.-China trade deal is not over, saying in a statement that his comments had been “taken wildly out of context.” “They had nothing at all to do with the Phase I trade deal, which continues in place,” he added. President Donald Trump also tweeted that the existing trade deal remains in place. Stock futures recovered earlier losses following the comments.
Meanwhile, the coronavirus pandemic continues to be the main focus for investors as a number of states in the U.S. continued to report a rise in new cases and hospitalizations. The World Health Organization has reported record rises in several countries in the last few days, and has denied claims that increased testing is the sole driver behind higher case numbers.
In Europe, investors will be focusing on the latest indicator on the state of the euro zone economy when preliminary purchasing manager’s index (PMI) data for June is released at 9 a.m. London time.
Reference: CNBC, Reuters
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