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Asian markets extend global rally as Trump fuels trade deal hope

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AFP Hong Kong
Last Updated : Jun 19 2019 | 2:30 PM IST

Asian markets rallied Wednesday after Donald Trump hailed "very good" phone talks with Xi Jinping and said they would meet at the G20 next week, renewing hopes of a deal to end a painful China-US trade war that has jolted the global economy.

The US president's comments provided a much needed boost to investors after a month of volatility sparked by his shock decision to hit China with fresh tariffs, ending months of apparently positive negotiations.

Adding to the upbeat mood were comments from the European Central Bank head Mario Draghi hinting at a cut in interest rates to support the stuttering eurozone economy.

Also, the Federal Reserve is due to end its latest policy meeting later Wednesday, with dealers hoping for some idea about its own plans for rates.

After a healthy lead from Wall Street, the vast majority of Asia's markets posted gains of at least one percent -- with Hong Kong leading the way by jumping more than two percent.

Tokyo ended 1.7 per cent higher, Shanghai added one per cent, Singapore put on 1.4 per cent and Sydney 1.2 per cent.

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Taipei added two per cent, while Wellington, Seoul, Manila, Jakarta and Bangkok were above the one per cent level. Mumbai was also in positive territory.

In early European trade, London added 0.2 percent having added more than one percent Tuesday. Frankfurt and Paris were slightly higher.

The rally was sparked after Trump tweeted: "Had a very good telephone conversation with President Xi of China. We will be having an extended meeting next week at the G-20 in Japan. Our respective teams will begin talks prior to our meeting."
"Trump is kick-starting his (re-election) campaign and he will need strong economic performance over the next 18 months. President Xi will also need trade tension to cool down to support China's domestic economy, while pursuing financial market liberalisation."

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First Published: Jun 19 2019 | 2:30 PM IST

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