Most of the Asian Markets gained on Thursday because of the growing optimism that the United States and China finally resolve the long-running trade dispute which disrupted global trades. Reports said that the two sides are currently working on an outline for a deal.
The hope that the trade negotiations and the expectations that the Federal Reserve eases up on the pace of monetary tightening while local and global economic growth slows caused the stellar start of Equities of many nations.
On Thursday, the Asian region is in an upbeat mood after Bloomberg News reported that Chinese negotiators and their American counterparts were sketching out a number of memorandum of understanding on critical issues that include intellectual property and transfer of technology.
The report from unidentified sources said that Washington is not expecting a final agreement this week but the top negotiator of China, Liu He, is scheduled to meet United States President Donald Trump on Friday. The markets across Asia started to gain on Thursday.
Hong Kong gained 0.4 percent. However, Shanghai fell by 0.3 percent after wavering through the day. The value of yuan reached its strongest against the dollar since July. The strength of yuan is supported by the call of the United States to China not to weaken its value to balance the impact of tariffs.
Tokyo closed with an increase of 0.2 percent, Sydney gained 0.7 percent, Wellington gained 0.6 percent, and Taiwan rose by 0.5 percent. Markets of Mumbai, Bangkok, and Jakarta are at a steady pace. Seoul and Manila, however, however, dipped. London dropped by 0.3 percent while Frankfurt rose by 0.4 percent and the Paris market gained 0.1 percent.
United States President Trump claimed that the talks are going "very well" and he has indicated that he could extend the deadline if the students agreed on a deal although there was no visible sign of progress in the talks.
Observers, however, warned that things could get messy if expectations were not met. According to Jeffrey Halley, a senior market analyst at OANDA, there's a lot of optimism baked into global markets on the outcome of the negotiations and precisely zero detail on the actual result. He added that a suboptimal outcome could make for a potentially ugly correction in equities and currencies in particular.
The Federal Reserves' latest policy meeting discussed the concerns about the global outlook and trade tensions in which they said that United States growth would "step down" from last year's rapid pace.
