World stock markets advanced yesterday as investors awaited what they hoped will be encouraging news from US-China trade talks in Washington, dealers said.
Europe’s key equity markets were up to around 0.5 per cent higher, building on Asian gains.
Nearing the half-way point, London’s benchmark FTSE 100 shares index rose by half a per cent, while the Frankfurt DAX 30 and the Paris CAC 40 gained 0.6 per cent and 0.3 per cent respectively. Hong Kong finished up 0.7 per cent and Shanghai rallied 1.9 per cent on hopes for fresh stimulus by Chinese authorities.
Seoul and Wellington both edged up 0.1 per cent, while Manila and Bangkok rebounded to sit in positive territory.
Tokyo was down 0.2 per cent and Singapore shed 0.3 per cent.
Wall Street was also modestly higher at the opening bell in New York, as US economic concerns appeared to be eclipsed by hopes that high-level talks between the United States and China will seal a trade war truce.
“Global equities saw some modest gains... as investors await results from the Sino-US trade talks,” said Oanda analyst Dean Popplewell.
“Will we get some concrete news or perhaps an announcement of an extension of the deadline for implementing further US tariffs?”
And with the March deadline approaching, US President Donald Trump will meet with China’s top negotiator and Xi Jinping's top economics envoy, Liu He.
The Economist Intelligence Unit (EIU), meanwhile, forecast that the two sides will make “some progress” – but were unlikely to clinch any “meaningful” deal.
“The likelihood that the United States and China will make some progress in the ongoing trade talks has increased as a result of mounting domestic pressure in both eco-nomies,” noted EIU global economist Cailin Birchin a report.
“Nonetheless, we do not expect a meaningful agreement, as the US and China enter into a strategic competition for economic ‒ and particularly technological ‒ dominance.”
The EIU added that any deal would therefore only provide “temporary relief” from trade tensions. The lack of information on the crunch talks led dealers in New York to take their cue from figures showing home sales at a three-year low, while sales of durable goods missed expectations.
All three main indices on Wall Street finished in the red.
On currency markets, the dollar held gains against most other currencies as the soft United States data sparked a shift by investors towards the safer option, while the pound remains under pressure from ongoing Brexit uncertainty.
The Australian dollar was down but recovered pared losses that came on the back of a report that China had banned coal imports from the country, with tensions between the two becoming strained over Canberra's decision to ban telecoms giant Huawei’s 5G equipment over security risks.