Stocks across Asia were powering ahead for a second straight day in early trading Thursday as investors took a no-news-is-good-news view of the U.S.-China trade talks a day after President Trump said phone exchanges were going well.
Hong Kong stocks have again jumped in early trading, outpacing others across Asia. The Hang Seng Index HSI, +1.20% is up 1.2% while the China Enterprises Index HSCEI, +1.35% has risen 0.7%, with the latter ending a 5-day slide on Wednesday. HSBC HSBC, +2.71% has rebounded 1.5% while Link REIT 0823, +1.16% has gained nearly 2%. Meanwhile, WuXi AppTec 603259, -0.15% has fallen 3% in early trading as the Shanghai-listed drug-R&D services provider debuts in Hong Kong.
The Nikkei NIK, +0.99% is up a 1% in morning trading in Japan as the yen fell overnight versus the rebounding euro and pound. Korea’s Kospi SEU, +0.62% has climbed 0.4% while Australia’s ASX 200, XJO, +0.14% which also gained more than 1% yesterday, is up just 0.1% with REITs and utilities down at least 1% as bond yields have rebounded some.
The continued strength in Asia came despite a warning from Nomura that Asian exports in January will likely register the biggest one-month fall in 38 months. The broker said that after an “abnormally strong” holiday effect-driven October, export growth on-year in November fell more than 10 percentage points in China, with significant declines in Korea and Taiwan. The warning “gels with our view of a deepening global electronics downturn,” once the effect of front-loading taper off, Nomura says.
China is preparing to replace an industrial policy savaged by the Trump administration as protectionist with a new program promising greater access for foreign companies, people briefed on the matter said Wednesday. The revised plan — Beijing’s latest effort to resolve trade tensions with the U.S. — would play down China’s bid to dominate manufacturing and be more open to participation by foreign companies, these people said.
Stocks in China responded positively, with the Shanghai Composite SHCOMP, +1.23% index up 1.4% and the Shenzhen stock index 399106, +1.11% , which had been lower early, rebounding to gain 1%. Recently listed firms are getting hit, though, with furniture maker Topstrong Living 300749, -7.88% tumbling 8%. Brewers are also pulling back following yesterday’s run. But battery stocks remain somewhat upbeat.
The New Zealand government’s half-year update shows a healthy set of books, says ANZ, with fiscal projections coming in very similar to May’s budget and the government continuing to operate within its self-imposed fiscal rules. Net debt, for example, is comfortably forecast to be below 20% within 4 years, the bank notes.
New Zealand’s NZX 50 NZ50GR, +0.63% , meanwhile, has risen 0.6% as of early afternoon as it seeks a 3rd-straight gain.
