Asian stocks rallied Wednesday following gains in the U.S. amid optimism on the potential for progress in trade talks between Washington and Beijing. Treasuries steadied after their recent slide and the dollar dipped.
Equities in Hong Kong, South Korea and Japan led gains after all major U.S. indexes climbed. U.S. President Donald Trump is eager to strike a deal to boost financial markets that have been roiled by the trade war, according to people familiar. Earlier, he tweeted that talks are “going very well” as negotiations continued with China. Crude climbed above $50 a barrel for the first time this year.
Developments in U.S.-China trade relations remain a focal point at the same time as parts of the American government are shut down with lawmakers unable to agree on a budget proposal that Trump will sign. Trump will deliver a prime-time televised address on Tuesday evening about his demand for a wall along the Mexican border, which is at the heart of the dispute. Then comes the start of the earnings season, where investors’ dialed back expectations for profit growth will be tested following last month’s tumble in global equities.
“We could get some more stabilization and a floor in the market if we make strides towards an agreement” on trade, Kate Moore, chief equity strategist at BlackRock Inc., said on Bloomberg Television. “But this is going to be an issue overhanging markets I believe for multiple years.”