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Hong Kong’s Hang Seng index jumped nearly 4% while China’s Shanghai Composite and Japan’s Nikkei rose more than 2% in Friday afternoon trading.
China’s beaten down currency, the yuan, also rose almost 0.3% against the dollar amid the buoyant mood. US stock futures were up nearly 1%.
The rally in Asian markets, which like many others suffered heavy losses in October, came despite a lack of details on how Trump aims to strike a deal with Xi.
The Trump administration says it’s trying to pressure Beijing to make deep changes to its economic policies, accusing it of overseeing the theft of US intellectual property and unfairly boosting Chinese companies through aggressive industrial programs.
Analysts are highly skeptical that China will agree to major changes that would address the US concerns — especially at such short notice.
“These are longstanding structural issues within the Chinese economy and cannot be reversed overnight,” said Logan Wright, Hong Kong-based director of China research at research firm Rhodium Group.
Investors may be letting their hopes get the better of them, according to some market watchers.
“This seems a perfect way to ensure equities rally into election day, put Xi into a box in terms of what is expected of him in the terms of the deal … and then have someone to blame when the deal then falls through,” Every said in an email.
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