Asia-Pacific stocks rallied as a positive turn for sentiment on Wall Street from Friday fed through to trading on Monday, despite the lack of any material changes following the end of last week’s US-China trade talks.
“Last Friday, Asia was dominated by negative sentiment over trade talks, this Monday morning, it is all smiles and optimism again” said Robert Carnell, Asia-Pacific chief economist at ING. “This could go on a while.”
“Perhaps the worst outcome now might be an extension of the March 1 deadline to provide more time”, he added. “That leaves room for plenty more 180 degree turns in sentiment before, we assume, some eventual ‘deal’ is reached.”
Hong Kong’s Hang Seng was up 1.6 per cent with gains across the board while China’s CSI 300 of major Shanghai and Shenzhen-listed stocks was up 1.7 per cent.
Tokyo’s Topix jumped 1.5 per cent, also with gains across the board. Energy stocks were far ahead of the pack with a rise of 4 per cent on the back of gains for oil prices posted during Friday’s session.
Energy stocks were also the best performers in Sydney, climbing 1.5 per cent against a rise of 0.5 per cent for the benchmark S&P/ASX 200 index. Virtually all market segments were up outside of industrials, which were basically flat.
The gains for equities in Asian trading came after the S&P 500 climbed 1.1 per cent on Friday as investors kept faith that Beijing and Washington would still manage to avert an escalation in the trade war between the world’s two biggest economies. Trade talks will resume in Washington later on Monday.