Asian markets mixed as dealers await trade news, Hong Kong rises

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HONG KONG: Asian markets were mixed in early trade on Tuesday as investors weighed the latest in China-US trade talks. Developments were monitored, while Hong Kong started a modest recovery after the previous day’s heavy losses.

The pound held on to gains after British Prime Minister Boris Johnson was benefited by news that the Brexit Party would not contest hundreds of seats against his Conservatives in next month’s general election.

While there is widespread expectation that China and the U.S. will eventually reach a small trade deal, the waters were muddied over the weekend when Donald Trump dismissed Beijing’s claims that he had stalled progress in negotiations. At the same time, the tariff withdrawal plan was agreed upon.

The comments reminded dealers that talks, while moving forward, remain fragile and that there will be some hurdles in the way of a broader, deal.

“The markets have been shaken,” said Matt Forrester, chief investment officer at BNY Mellon’s Lockwood Advisors.

“We will need more concrete information about the structure and timing of any final trade arrangements, but in the meantime we are working on bits and pieces of information.”

Stephen Innes at AxiTrader said that a speech by Trump at the New York Economic Club later in the day “could be the key event of the week, especially if the president has anything concrete about his upcoming meeting with President Xi (Jinping). Hang details”.

– Sterling Election Boost –

Hong Kong rallied but traders moved cautiously after stocks fell more than 2 percent on Monday as the city was gripped by the worst violence in months of protests, in which one person was shot dead. And the other was set on fire.

The city was on edge with sporadic protests on Tuesday, while the US expressed “deep concern” over the situation in Hong Kong and called for restraint from security forces and protesters.

“This is the 24th week of unrest and it’s still very unclear what could exacerbate the situation,” said National Australia Bank’s Tapas Strickland. However, he added: “Even so, as long as Beijing gives Hong Kong latitude to deal with the protests, the unrest is likely to have only an isolated impact on financial markets.”

Tokyo ended the morning session up 0.2 percent, Singapore up 0.3 percent, Taipei up 0.4 percent and Seoul up 0.1 percent.

However, Shanghai fell by 0.2 percent and Sydney by 0.5 percent. Wellington, Manila and Jakarta were also down.

Markets welcomed news that Nigel Farage, a key force behind Britain’s 2016 referendum to leave the European Union, did not stand for his Brexit Party candidates in Johnson’s Conservatives’ 317 seats in the Dec. 12 poll. will do

Strickland added, “The Brexit Party will contest Labour-held seats… The market took this as a sign that the chances of a hung parliament or a Labor minority government led by (Jeremy) Corbyn were to be reduced. “

The pound rose against the dollar and euro on Monday and remained higher in Asia, supported by data that showed Britain’s economy had avoided slipping into recession in the third quarter. .

– Important data around 0230 GMT –