Bulls And Bears

Asia markets rally on US-China talks reports

Hang Seng leads the way with 2.54% jump after six days of losses; STI up 0.23%

Investors latched on to signs yesterday that the trade tensions between the United States and China that have blighted markets for the past weeks were easing a little.

Hopes were raised by reports that US Treasury Secretary Steven Mnuchin had invited top Chinese officials to restart trade talks.

Markets across Asia rallied in response, with Hong Kong's Hang Seng leading the way with a 2.54 per cent jump after six days of losses.

The Straits Times Index (STI) was not so buoyant, eking out a 7.12-point increase - or 0.23 per cent - to 3,131.77.

Turnover was 2.1 billion shares worth $1.1 billion, with 206 gainers besting losers on 190.

Rex International Holding again led actives, losing 0.2 cent or 2.02 per cent to 9.7 cents after 116.4 million shares changed hands. The oilfield services firm has seen heavy trading since end-August when a significant oil reservoir was discovered by a Norwegian drilling firm.

Contract manufacturer Venture Corp dropped by 5.69 per cent, or 96 cents, to $15.90. The unusual activity prompted a query from the Singapore Exchange. Venture had not responded by the time the markets closed.

Singtel crept up 0.3 per cent to $3.11 with 16.8 million shares done after the telco said yesterday that it had won the rights to air matches from the FA Cup, the Dutch Eredivisie and Chinese Super League.

CapitaLand Commercial Trust (CCT) also saw active trading after news on Wednesday that HSBC had signed a one-year extension for its lease of CCT's HSBC Building at 21 Collyer Quay.

About 10.7 million units were traded as the counter ended flat at $1.74, before HSBC said after market close that it will relocate its head office to Marina Bay Financial Centre Tower 2 in 2020.

The overall focus for investors will remain on trade, with many likely to view yesterday's Sino-US developments with sceptical eyes.

"This is not the first time Washington has escalated trade disputes, only to request China back to the negotiation table," noted FXTM research analyst Lukman Otunuga.

"Although the outcome of any possible trade talks remains uncertain, the meeting may be a constructive step to easing tensions between the world's two largest economies."

Mr Robert Carnell, ING's chief economist and head of research for Asia-Pacific, said: "The US initiative to revive trade talks may come to nothing, but without much else to go on, it does at least offer some hope of an end to this episode."

A version of this article appeared in the print edition of The Straits Times on September 14, 2018, with the headline 'Asia markets rally on US-China talks reports'. Print Edition | Subscribe