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Asian equities and currencies rebounded on Thursday, bolstering the advance of the day as investors were encouraged by a number of positive developments in trade, Hong Kong and Europe.
Markets were already on an upward trajectory after the Hong Kong leader on Wednesday withdrew a controversial extradition bill that sparked months of sometimes violent protests in the financial center.
But the good news continued to come day after day, with the news that Italy had formed a new moderate and pro-European government, while British MPs were getting closer to passing a law banning a Brexit without negotiation.
Then on Thursday morning, China announced that it would resume trade negotiations with the United States in Washington next month.
Chinese Vice Premier Liu He spoke by phone Thursday morning with US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin and agreed to "work together and take action." to create favorable conditions for consultations ".
The announcement provided a small sign of progress in the long lineage that weighed on the global economy and the stock markets.
Asian stocks were all in positive territory, taking a good lead on Wall Street, where the S & P 500 moved closer to a new record.
Hong Kong added 0.4% in the morning, after rising nearly 4% Wednesday following the shocking decision of the general manager Carrie Lam to withdraw the bill.
Tokyo started the break by more than 2%, while Shanghai jumped 1.6% and Sydney by 1%.
Seoul gained 1.1%, Singapore 0.5% and Taipei and Wellington 0.9% each. Manila and Jakarta were also in positive territory.
Sterling extends gains
The Chinese firm's comments in favor of a reduction in the amount of cash that banks must keep in reserve have also contributed to the positive atmosphere, with the aim of releasing more money into the threatening economy.
"A complete reduction in the reserve requirement ratio of banks is needed to ensure effective financial support for economic growth, as the global economy slows and domestic consumption and investment face barriers," said Wen. Bin, China Minsheng Banking Corp.
In the foreign exchange markets, higher-yielding and riskier assets rose broadly against the dollar, led by the Australian dollar and the South Korean won.
The Chinese yuan, which hit its lowest level in 11 years earlier in the week, was also up sharply.
The pound sterling continued its recovery after reaching its lowest level since 1985, with the exception of a "flash crash" in 2016.
The unit took advantage of its purchases as Westminster legislators passed legislation to prevent the collapse of the European Union on October 31, embarrassingly striking new Prime Minister Boris Johnson.
On Wednesday, they also blocked his attempt to call general elections until their bill became law. Economists have warned that a Brexit without an agreement could hit the British economy.
The euro has also been supported by events in Italy, where the new coalition will be sworn in on Thursday, marking the end of a crisis that has been going on for several months and that is being triggered by the far right.
The price of oil was built on gains of more than 4% recorded on Wednesday for both contracts, in response to positive news, as well as new US sanctions on Iran and Russia's promise to stick an agreement with OPEC to reduce production.
However, if the atmosphere in the trading rooms is positive, Stephen Innes, market strategist for the Asia-Pacific region at AxiTrader, has issued a note of caution.
"While a drop in the geopolitical risk premium is a welcome relief, while the omnipresent trade war clouds are threateningly threatening the market … the air remains cautious. "
Key figures around 02:30 GMT
Tokyo – Nikkei 225: up 2.3% to 21,131.08 (pause)
Hong Kong – Hang Seng: 0.4% increase to 26,635.36
Shanghai – Composite: up 1.6% at 3,003.51
Pound / Dollar: up to 1.2244 USD vs. 1.2241 USD at 2100 GMT
Euro / pound: DOWN to 90.09 pence from 90.13 pence
Euro / dollar: DOWN to $ 1.1030 from $ 1.1033
Dollar / yen: up to 106.68 yen from 106.41 yen
West Texas Intermediate up 23 cents to $ 56.49 a barrel
Brent from the North Sea: up 28 cents to 60.98 dollars a barrel
New York – Dow: 0.9% increase to 26,355.47 (closing)
London – FTSE 100: 0.6% increase to 7,311.26 (closing)
– AFP
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