Asian equities jump on ‘very good’ trade talks

Asian shares yesterday jumped after US President Donald Trump on Thursday said he would meet with China’s top trade negotiator, stirring hopes for an agreement, while the British pound resumed its climb amid optimism over a possible Brexit deal.

European shares were mostly expected to continue the rally. Pan-region Euro STOXX 50 futures rose 0.26 percent to 3,494 and German DAX futures gained 0.29 percent to 12,209. FTSE futures were down 0.43 percent at 7,142.5 early in the day.

MSCI’s broadest index of Asia-Pacific shares outside Japan advanced 1.3 percent yesterday afternoon in Asia. S&P e-mini futures added 0.45 percent.

Australian shares climbed 0.9 percent, while Japan’s Nikkei 225 gained 1.2 percent. Chinese blue-chips were up nearly 1 percent after a slow start.

The bullish market mood came after a first day of trade talks between top US and Chinese negotiators, characterized by Trump as “very, very good.”

Even before Trump’s comments, hopes for an agreement helped to lift US markets. The Dow Jones Industrial Average on Thursday added 0.57 percent, the S&P 500 gained 0.64 percent and the NASDAQ Composite rose 0.6 percent.

While optimism around trade talks helped to drive a “classic risk-on session” overnight, the lack of runaway enthusiasm reflected broader investor caution, said Matt Simpson, senior market analyst at GAIN Capital in Singapore.

“We know that it’s just a few words from Trump,” he said.

Further positive developments in trade talks could boost markets on Monday, but low expectations for a deal mean that the lack of an agreement would not “necessarily [be] the end of the world for risk,” he added.

Analysts at National Australia Bank said freezing tariffs at current levels would be unlikely to reverse the trade-driven slowdown in economic growth.

“The uncertainty around unresolved structural issues, such as IP [intellectual property] theft

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