Risk appetite was given a strong boost as US and China are returning to the table for trade negotiations. At the time of writing, Nikkei is up 1.74%, Hong Kong HSI is up 2.37% and China Shanghai SSE is up 1.50%. Overnight, DOW rose 1.35%, S&P 500 rose 0.97% and NASDAQ rose 1.39%. Of course, in the background, ECB’s hints on additional monetary stimulus ahead were confidence lifting too.
The news started with Trump tweeting yesterday that he had a “very good telephone conversation” with Chinese President Xi Jinping. And Trump said both will have an “extended meeting” next week at the G20 in Osaka, Japan. The phone call was also confirmed by China’s state media.
Later at the White House, Trump told reporters, “I think we have a chance. I know that China wants to make a deal. They don’t like the tariffs, and a lot of companies are leaving China in order to avoid the tariffs”. He added “I think the meeting might very well go well, and frankly our people are starting to deal as of tomorrow. The teams are starting to deal. So we’ll see. China would like to make a deal. We’d like to make a deal, but it has to be a good deal for everybody.”
Chinese state media reported Xi saying “The key is to show consideration to each other’s legitimate concerns. We also hope that the United States treats Chinese companies fairly. I agree that the economic and trade teams of the two countries will maintain communication on how to resolve differences.”
HK HSI gaps higher at open and is currently up more than 2.3%.
