Trading

Asian shares rise as U.S, China trade negotiators talk

Asian shares rose on Friday as investors focused on talks between the United States and Chinese trade negotiators.

Chinese state media reported that trade representatives had held a phone call and pledged to cooperate on carrying out the countries’ Phase 1 trade deal.

The news lifted U.S. stock futures, pushing E-minis for the S&P 500 up 1.06% to 2,910.5.

MSCI’s broadest gauge of Asian share indexes outside Japan was 1.1% higher and Japan’s Nikkei added 1.78%.

Australian shares were 0.76% higher. China’s blue-chip CSI300 index gained 0.86%.

While rising equity markets on Friday were accompanied by a slight uptick in U.S. Treasury yields, bond markets remained focused on the shaky global economic picture as coronavirus-related lockdowns continue to depress economic activity, despite signs of reopening.

“The equity market is disconnected and optimistic … We’ve got this bizarre scenario at the moment, where the bond market is really looking at the doomsday economic data and also hopes for potentially further support from the U.S. Federal Reserve,” said Ryan Felsman, senior economist at CommSec in Sydney.

Data from Japan on Friday showed the impact of lockdowns, with household spending plunging 6% on year in March, and service-sector activity shrinking at a record pace.

Wall Street indexes climbed on Thursday, with the Nasdaq erasing losses for 2020, following a clutch of upbeat earnings. PayPal Holdings soared 14%.

After hitting a record lows of 0.129% on Thursday, the yield on U.S. two-year Treasurys ticked up to 0.1368%, while the benchmark 10-year note edged back up to 0.644% from the previous day’s close of 0.631%.

The yield on the 30-year bond rose to 1.3342% from a close of 1.321% Thursday.

Bond markets were jolted this week, and the U.S. yield curve steepened after the U.S. Treasury Department said it would introduce a long-planned 20-year bond and expected to borrow $2.999 trillion in the second quarter.

In currency trading, the dollar index fell by 0.171% to 99.646 after hitting a two-week high on Thursday as some investors took profits ahead of the jobs report while oil prices rose on hopes that easing lockdowns would boost demand.

Source: Voice of Nigeria