Top negotiators from China and the US flagged progress in last week’s discussions in Beijing on the tariffs row, with another round slated for this week in Washington.
While there have been few details, the general view on trading floors is that the economic superpowers are heading towards a deal that will end a long-running spat that helped sink global markets towards the end of last year.
A positive lead from Wall Street was picked up in Asia, with Tokyo ending the morning 2.2 percent higher, Hong Kong adding 1.6 percent and Shanghai climbing 2.3 percent.
Sydney and Singapore each jumped 0.8 percent, while Seoul piled on 1.2 percent, with Taipei and Wellington also in the green.
The rises were supported by a sharp jump in an index of Chinese manufacturing activity, which soothed concerns about the world’s number two economy and a key driver of the global economy.
– EU patience ‘running out’ –
The Purchasing Managers Index for March showed growth in the sector for the first time in four months and was far better than expected.
“The manufacturing print… will go a long way to allaying slowdown fears about China, at least in the short-term as the US-China trade talks move back to Washington this Wednesday,” said OANDA senior market analyst Jeffrey Halley.
Attention once again returns to Britain, where Prime Minister Theresa May failed on Friday to pass her Brexit deal through parliament, stoking uncertainty with just over a week before the deadline for leaving the European Union.
With MPs still unable to agree on a way forward there are fears the country will crash out of the bloc without a deal, putting pressure on the pound.
Lawmakers will hold a series of votes Monday to try to find a majority-backed plan to end the current crisis, though European Commission President Jean-Claude Juncker has said the EU is “running out” of patience as the saga plods on.
“Brexit is a mess, and sterling traders are getting bored with the continued political point scoring that has plagued the whole process,” said James Hughes, chief market analyst at AxiTrader.
“The closer we get to the proposed deadline of April 12 the more volatility we will surely see.”
Source: The Sun Daily