AVN 57.02 Increased By ▲ 5.38 (10.42%)
BOP 10.13 Increased By ▲ 0.36 (3.68%)
CHCC 128.83 Increased By ▲ 9.89 (8.32%)
DCL 9.32 Increased By ▲ 0.52 (5.91%)
DGKC 107.59 Increased By ▲ 3.45 (3.31%)
EFERT 67.50 Increased By ▲ 0.91 (1.37%)
EPCL 32.60 Increased By ▲ 1.56 (5.03%)
FCCL 21.12 Increased By ▲ 0.29 (1.39%)
FFL 11.97 Increased By ▲ 0.33 (2.84%)
HASCOL 13.58 Decreased By ▼ -0.03 (-0.22%)
HBL 124.66 Increased By ▲ 2.88 (2.36%)
HUBC 81.40 Increased By ▲ 0.99 (1.23%)
HUMNL 9.60 Increased By ▲ 0.18 (1.91%)
JSCL 15.85 Increased By ▲ 0.45 (2.92%)
KAPCO 24.75 Increased By ▲ 0.26 (1.06%)
KEL 3.71 Increased By ▲ 0.22 (6.3%)
LOTCHEM 13.20 Increased By ▲ 0.34 (2.64%)
MLCF 33.65 Increased By ▲ 1.40 (4.34%)
OGDC 114.50 Decreased By ▼ -0.29 (-0.25%)
PAEL 32.74 Increased By ▲ 0.74 (2.31%)
PIBTL 11.34 Increased By ▲ 0.40 (3.66%)
PIOC 76.10 Increased By ▲ 2.86 (3.91%)
POWER 8.12 Increased By ▲ 0.94 (13.08%)
PPL 99.03 Decreased By ▼ -1.06 (-1.06%)
PSO 184.00 Increased By ▲ 4.65 (2.59%)
SNGP 56.36 Increased By ▲ 0.95 (1.71%)
STPL 11.21 Increased By ▲ 0.09 (0.81%)
TRG 49.76 Increased By ▲ 3.34 (7.2%)
UNITY 12.56 Decreased By ▼ -0.03 (-0.24%)
WTL 1.01 No Change ▼ 0.00 (0%)
BR100 4,136 Increased By ▲ 72 (1.77%)
BR30 21,159 Increased By ▲ 380 (1.83%)
KSE100 39,872 Increased By ▲ 613 (1.56%)
KSE30 17,320 Increased By ▲ 250 (1.47%)
CASES 280,029 331
DEATHS 5,984 8
Sindh 121,486 Cases
Punjab 93,197 Cases
Balochistan 11,774 Cases
Islamabad 15,076 Cases
KP 34,223 Cases

Asian markets rally on perfect storm of positive news

HONG KONG: Asian equities and currencies rallied Thursday, building on the previous day's advance as investors were chee

05 Sep 2019

HONG KONG: Asian equities and currencies rallied Thursday, building on the previous day's advance as investors were cheered by a number of positive developments on trade, Hong Kong and Europe.

Markets were already on an upward trajectory after the leader of Hong Kong on Wednesday withdrew a controversial extradition bill that had sparked months of sometimes violent protests in the financial hub.

But the good news kept coming as the day wore on, with news that Italy had formed a new moderate, pro-European government, while British MPs moved closer to passing a law preventing a no-deal Brexit.

Then on Thursday morning, China announced it would resume trade talks with the United States in Washington next month.

Chinese Vice Premier Liu He spoke to US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin by phone Thursday morning, the commerce ministry statement said, and agreed to "work together and take practical actions to create favourable conditions for consultations".

The announcement provided a small sign of progress in the long-running row that has dragged on the global economy and stock markets.

Asian equities were all in positive territory, tracking a healthy lead from Wall Street, where the S&P 500 moved to within touching distance of a new record high.

Hong Kong added 0.4 percent in the morning, having soared almost four percent Wednesday on the back of Chief Executive Carrie Lam's shock decision to withdraw the bill.

Tokyo went into the break more than two percent higher and Shanghai jumped 1.6 percent, with Sydney one percent up.

Seoul gained 1.1 percent, Singapore 0.5 percent, and Taipei and Wellington 0.9 percent apiece. Manila and Jakarta were also well in positive territory.

- Sterling extends gains -

Adding to the positive vibe were comments from China's cabinet flagging a cut in the amount of cash banks must keep in reserve, a move aimed at releasing more cash into the stuttering economy.

"A full cut to banks' reserve ratio is needed to make sure of effective financial support to economic growth, as the global economy slows and domestic consumption and investment face headwinds," said Wen Bin, at China Minsheng Banking Corp.

On currency markets, high-yielding, riskier assets were up across the board against the dollar, led by the Australian dollar and South Korean won.

The Chinese yuan, which hit 11-year lows earlier in the week, was also well up.

The sterling continued its recovery, having slumped to its weakest level since 1985 except for a 2016 "flash crash".

The unit has enjoyed buying as lawmakers in Westminster push through legislation to avert crashing out of the EU on October 31, delivering an embarrassing blow to new Prime Minister Boris Johnson.

On Wednesday, they also blocked his attempt to call a general election until their bill had become law. Economists have warned that a no-deal Brexit could hammer the British economy.

The euro was also supported by developments in Italy, where the new coalition will be sworn in Thursday, drawing a line under a months-long crisis sparked by the far right.

Oil prices built on Wednesday's gains of more than four percent for both contracts, which came in response to the positive stories, as well as fresh US sanctions on Iran and Russia's promise to stick to a deal with OPEC to cut output.

However, while the mood on trading floors is positive, Stephen Innes, Asia-Pacific market strategist at AxiTrader, sounded a note of caution.

"While a drop in geopolitical risk premium comes as a welcome relief, with the omnipresent trade war clouds looming ominously over the market... the air remains thick with caution."

Copyright AFP (Agence France-Press), 2019