By Stanley White, TOKYO
Asian stocks edged higher on Monday as Chinese
shares reversed early losses due to hopes for progress in resolving the
U.S.-China trade war and expectations for greater investment inflows into Hong
Kong.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.19%. Chinese shares .CSI300 rose 0.13%, while Japan's Nikkei .N225 rose 0.28%.
The pound slipped from a five-month high against the dollar and
the euro after the British parliament forced Prime Minister Boris Johnson to
seek a delay to an Oct. 31 deadline for Britain’s departure from the bloc.
The vote for an extension dealt a blow to optimism that a deal
agreed last week would ensure Brexit happens with little economic disruption.
Oil futures fell as lingering economic growth concerns and
excess supplies of crude prompted speculators to trim their long positions.
Chinese vice premier Liu He said on Friday that China will work
with the United States to address each other’s concerns, and that stopping the
trade war would be good for both sides and the world.
Shares in Hong Kong also got a lift after Chinese bourses
revised rules to allow mainland investors to buy Hong Kong-listed dual-class
shares for the first time.
“We’ve had some positive news from Liu, and allowing Chinese
investors direct access to dual-listed Hong Kong shares is a another positive,”
said Sean Darby, global equity strategist at Jefferies in Hong Kong.
“There is still a lot of money on the sidelines, and there are
only eight or nine weeks left to put that money to work before we end the year.
I expect markets to remain bid.”
U.S. stock futures ESc1 rose 0.27% in Asia as investors brace
for high-profile earnings this week from Microsoft Corp (MSFT.O), Amazon.com (AMZN.O) and others.
The S&P 500 fell 0.4% on Friday partly due to worries about
fallout from the U.S.-China trade war.
A 15-month long trade war between the United States and China
has shown few signs of a durable resolution being reached despite several
rounds of talks.
Financial markets have been whipsawed over this period as a
steady increase in tit-for-tat tariffs have slowed global trade and raised the
risk of recession for some countries.
Underscoring the damage, Japan’s exports fell in September for
the 10th straight month, while South Korea’s exports for the first 20 days of
October dived 19.5% year-on-year, data on Monday showed.
Hong Kong shares .HSI erased early losses to rise 0.26%.
Chinese bourses on Friday revised rules that would allow Hong
Kong-listed dual-class shares to be included in the Stock Connect scheme for
the first time, potentially benefiting popular tech companies such as Xiaomi
Corp (1810.HK) and Meituan Dianping (3690.HK).
The rule change, which will take effect on Oct. 28, could be a
positive for Hong Kong shares, which have been battered during months of often
violent protest against Chinese rule of the former British colony.
The pound GBP=D3 fell 0.7% to $1.2911 and was off about 0.4% to
86.46 pence per euro.
The British government insists Brexit will take place on Oct.
31, but uncertainty over how British lawmakers will respond could weigh on
sentiment for sterling.
The leader of the House of Commons says the government plans to
put the new Brexit deal to a debate and vote on Monday, but it is unclear if
the speaker of the House will let this happen.
Elsewhere in the currency markets, the dollar edged 0.1% higher
to $1.1157 per euro EUR=EBS but held steady at 108.49 yen JPY=EBS.
U.S. crude CLc1 dipped 0.24% to $53.65 a barrel. Brent crude
LCOc1 fell 0.34% to $59.22 per barrel.
Money managers cut their net long U.S. crude futures and options
positions in the week to Oct. 15, the U.S. Commodity Futures Trading Commission
(CFTC) said on Friday.
Long bets on U.S. crude have dropped sharply in the last two
weeks after a spate of weak economic figures worldwide fanned concerns about
global energy demand.
Treasury prices fell in Asia. The yield on benchmark 10-year
Treasury notes US10YT=RR rose to 1.7554%.
Gold XAU=, often considered safe-haven asset, was little changed
at $1,490.12 per ounce. - Reuters
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