The major Asia/Pacific stock indexes are trading mostly higher on Tuesday, as U.S. President Trump concluded his state visit to Japan. Investors may be viewing the trip as a small success for what Trump didn’t say rather than what he accomplished. In other words, Trump didn’t say or tweet anything to rile the Chinese, allowing the trade talks with Japan to move to the forefront and the trade dispute between the United States and China to continue to simmer.
In the cash market at 05:14 GMT, Japan’s Nikkei 225 Index is trading 21278.30, up 95.72 or +0.45 percent and Hong Kong’s Hang Seng Index is at 27422.98, up 134.89 or +0.49 percent. In South Korea, the KOSPI Index is at 2046.89, up 2.68 or +0.13 percent. China’s Shanghai Index is trading 2919.00, up 26.62 or +0.92 percent and Australia’s S&P/ASX 200 is at 6484.40, up 32.50 or +0.50%.
No Major Agreement Reached
Trump’s trip to Japan ended with no major trade deal being reached. This was not a surprise since the trip seemed to focus more on pomp and circumstance than resolving deep issues on trade.
Japan’s Prime Minister Shinzo Abe knows how to play Trump and he delivered. He made Trump the center of attention throughout the trip by letting him speak to business leaders, sit front and center at a Sumo wrestling match and even meet the emperor. Furthermore, they both ate hamburgers and played golf. The meat on the hamburger was probably Kobe beer and Abe likely let Trump win the round of golf.
But reach a trade agreement at this time? That wasn’t in the cards. At times, the Trump seemed to have been somewhere else, saying he’s aiming to reach a trade deal after Japan’s July elections, while Japanese officials said there was no such talk.
In Other News
Shares of auto firms rose on merger news out of Europe on Monday, but broad uncertainties over trade and economic growth kept a lid on gains.
Shares in China jumped after data showed Chinese industrial firms’ profits shrank in April, which is expected to prompt more government stimulus to support the slowing economy.
Overall, traders feel there is a lack of direction in the markets with economic indicators mixed and trade war risks lingering. However, with the bias still tilted to loose monetary policy and more stimulus from the central banks, stocks are being propped up.
Traders also felt the markets would continue to trade rangebound because broad market sentiment remained uncertain ahead of a possible meeting between the Chinese and U.S. presidents at the G20 summit next month.
This article was originally posted on FX Empire
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