BEIJING – Asian stock markets were mixed Friday amid uncertainty about a possible U.S.-Chinese agreement to roll back tariffs in their trade war.
A currency trader stands by the screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea, Friday, Nov. 8, 2019. Asian stock markets were mixed Friday amid uncertainty about a possible U.S.-Chinese agreement to roll back tariffs in their trade war. (AP Photo/Lee Jin-man)
Shanghai advanced after Beijing said Thursday the two sides agreed to the step if they make progress on an interim deal. But Hong Kong declined and Tokyo was little-changed amid concern about possible opposition within the White House.
If the deal pans out, “it will be an emphatic upside surprise for the global economy,” said Vishnu Varathan of Mizuho Bank in a report.
However, “we cannot rule out a gap” between the U.S. and Chinese positions, Varathan warned. And he said the Federal Reserve might turn “less dovish” if the deal “takes off with more promise than anticipated” and tariffs fall, easing pressure on U.S. economic growth.
The Shanghai Composite Index gained 0.3% to 2,989.24 while Hong Kong’s Hang Seng tumbled 0.4% to 27,735.63. Tokyo’s Nikkei 225 edged up 22 points to 23,352.10.
Seoul’s Kospi shed 0.2% to 2,139.00 and Sydney’s S&P-ASX 200 lost 0.2% to 6,714.20. Taiwan, New Zealand and most Southeast Asian markets declined.
On Wall Street, the benchmark Standard & Poor’s 500 index gained 0.3% to a record 3,085.18. It was up 0.7% at one point. The Dow Jones Industrial Average climbed 0.7% to a record 27,674.80.
The Nasdaq composite finished just shy of its all-time high after rising 0.3% to 8,434.52.
Encouraging reports on the U.S. economy and corporate profits have helped drive stocks back to record heights. The job market is strong, and the Fed has cut interest rates three times.
That leaves the U.S.-Chinese trade war as the wild card for the global economy.
Trump announced a “Phase 1” agreement in October but the two sides still are negotiating the details. They have yet to announce progress on major disputes about China’s trade surplus and technology policy.
The two biggest global economies have raised tariffs on billions of dollars of each other’s goods. That has disrupted supply chains, threatening to chill worldwide economic growth.
Investors were encouraged when the Chinese Commerce Ministry said Thursday the two sides agreed to a “phased reduction” of punitive tariffs if the deal goes ahead. But enthusiasm was tempered by concern critics in the White House might oppose such a step.
A person who was briefed on the talks Thursday told The Associated Press there were still deliberations in the White House about how far to roll back the tariffs.
ENERGY: Benchmark U.S. crude fell 20 cents to $56.95 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 80 cents on Thursday to close at $57.15. Brent crude, used to price international oils, declined 10 cents to $62.19 per barrel in London. It advanced 55 cents the previous session to $62.29.
CURRENCY: The dollar declined to 109.24 yen from Thursday’s 109.28 yen. The euro was unchanged at $1.1051. /gsg