Bulls are back as Asian stocks rise thanks to a phone call

Donald Trump said his Chinese counterpart Xi Jinping wanted to reach an agreement to end a growing trade war. Photo: Reuters

Superlatives do not fail to describe this situation. Stock Market Rally: Best four-day gain in over two years, best week since February, first gain in six weeks and higher trading volume in all areas – a single phone conversation between leaders of the world's two largest economies. Donald Trump, their first phone call publicly released for nearly six months, said his Chinese counterpart wanted to reach an agreement ending a trade war that was only worsening. Shanghai's composite index has exploded, following indications last week that new stimulus measures could The Hang Seng index has further increased, recording a 2.7% increase.

Even Apple Inc.'s poor earnings results did not dampen the mood. Suppliers fell by the beginning of the trading, technology companies MSCI Asia-Pacific rose 2.4% all other sectors on Friday.

There was also a myriad of other good news from the region:

Chinese President Xi Jinping organized a forum with representatives of large national private companies and promised them to create a better environment. With promises of tax cuts and financial badistance to non-state companies, the ChiNext index gained 3.8%, which is lower than the Shanghai Composite gain. South Korea's Kospi Index recorded the largest gain in more than a year, with companies such as Daelim Industries and GS Retail exceeding expectations, lower crude oil prices, and Chinese stimulus raising shares related to metal. Japanese telecom operators rebounded after KDDI announced it would not follow NTT Docomo's mobile price reductions and confirmed that it would partner with newcomer Rakuten. Progress in trade between the United States and China has also eased sentiment. The Nikkei 225 Stock Average nearly cleared Thursday's loss.

The skeptics are still hiding. Given the unresolved trade dispute, some market players are still unconvinced and see a technical rebound after the shock. "We experienced such a magnitude earlier than the declines. So people have seen the opportunity to trade the rebound, "said Linus Yip the chief strategist at First Shanghai Securities," But if we have reached the bottom, I think that remains to be seen. "[19659004] On a more moderate tone, Tai Hui of JPMorgan Asset Management is cautiously optimistic. "The moderation of the USD, stabilizing trade relations between the United States and China and Beijing's new stimulus measures will be the essential ingredients to restore market confidence in Asia," he said. in an email. "Although we are always cautious about a complete resolution of recent medium-term tensions, the resumption of the dialogue between Washington and Beijing would be suitable for investors at the moment".

The week is not over yet. Malaysia's budget for 2019 is expected to be released later on Friday, and capital investors will follow closely. Last month, the FTSE Bursa Malaysia Index, a benchmark, fell 3.7% in two days after Prime Minister Mahathir Mohamad announced that the government would create new taxes to strengthen the state budget. , constrained by the debt and the change of the consumption tax. There is also the report on employment in the United States, the last before the parliamentary elections next Tuesday, which could show that hiring has improved and that the unemployment rate has been kept at its lowest level in 48 years.