ASX set for gains as US shares resume record run

Stocks on Wall Street rose to fresh record highs after reports the US would remove China from its list of currency manipulators, which has been a major obstacle to a trade pact between the two nations.

Markets at 9:00am (AEDT):ASX SPI futures +0.5pc at 6,873, ASX 200 (Monday’s close) flat at 6,904AUD: 69.03 US cents, 53.13 British pence, 61.99 Euro cents, 75.88 Japanese yen, $NZ1.041US: Dow Jones +0.3pc at 28,907, S&P 500 +0.7pc at 3,288, Nasdaq +1pc at 9,274Europe: FTSE 100 +0.4pc at 7,618, DAX -0.2pc at 13,452, CAC 0.0pc at 6,036, Euro Stoxx 50 -0.3pc at 3,780Commodities: Brent crude -0.2pc at $US64.23/barrel, spot gold 0.0pc at $US1,548/ounce

The news comes ahead of the expected signing of the first phase of a long awaited trade deal between Washington and Beijing tomorrow by US President Donald Trump and Chinese Vice-Premier Liu He.

The reports come after the US Treasury Department formally labelled China a currency manipulator in August last year, accusing it of lowering its currency to get a trade advantage.

The designation further escalated the trade dispute, after China’s central bank allowed the Chinese currency, the yuan, to fall in response to new US tariffs.

Bloomberg reported that the currency manipulator designation prompted Beijing to increase transparency around the pricing of the yuan.

However, the International Monetary Fund said in September that the yuan was fairly valued and there was no evidence of manipulation.

In other US news, the nation’s federal budget deficit rose above $US1 trillion last year for the first time since 2012, according to the Treasury Department.

The budget shortfall reached $US1.02 trillion for 2019, up by 17.1 per cent from 2018 despite a rise in revenue from company tax.

Rising corporate tax revenue helped lower the pace of increase

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