US stocks open lower after weak economic growth report
SINGAPORE (AP) — Asian shares were mostly higher on Friday after a report suggested that the leaders of China and the U.S. could be endorsing a trade deal in weeks.
According to Bloomberg, U.S. officials are preparing a final trade deal ahead of a summit between President Donald Trump and Chinese leader Xi Jinping, which could take place as soon as mid-March. It cited unnamed sources close to the matter.
Japan’s Nikkei 225 index picked up 1.1 percent to 21,617.84 and Hong Kong’s Hang Seng added 0.4 percent to 28,761.76. The Shanghai Composite index fell back from early gains, edging just 0.1 percent higher to 2,945.05 and Australia’s S&P ASX/200 gained 0.6 percent to 6,202.40.
Shares rose in Singapore and Indonesia but fell in Malaysia. South Korean markets were closed for a holiday.
Traders hope that a tariffs battle waged by the world’s two largest economies would soon be called off if a deal is reached.
Trump and Xi agreed to a 90-day ceasefire in December after raising import taxes on billions of dollars of each other’s goods. The U.S. was set to hit China with a fresh wave of tariffs once the agreement expires on Saturday.
While progress on issues like Washington’s unhappiness over Beijing’s technology policy has been slow, Trump said he will postpone the tariffs to give the countries more time to talk. He did not say for how long.
Buying in Asia was supported by an announcement by MSCI, a leading provider of indexes and analytics. MSCI said it will quadruple the weight of Chinese A shares in its global indexes by November. It will also add more Chinese stocks to its Emerging Markets Index, giving the country’s foreign inflows a much-needed boost.
A private survey also added to Chinese growth hopes. The Caixin manufacturing purchasing manager’s index, which measures growth in the sector, jumped to 49.9 in February, from 48.3 in the previous month. The index is on a 100-point scale, with 50 separating contraction from growth.
This comes after China’s official manufacturing PMI fell 0.3 points to 49.2 in February, a three-year low.
WALL STREET: Stocks slid Thursday on news that the U.S. economy slowed at the end of last year, although the performance still beat analysts’ expectations. The country’s gross domestic product expanded at a 2.6 percent annual rate in the October-December period, down from 3.4 percent in the third quarter. The S&P 500 index lost 0.3 percent to 2,784.49 and the Dow Jones Industrial Average fell 0.3 percent to 25,916.00. The Nasdaq composite shed 0.3 percent to 7,532.53, while the Russell 2000 index of smaller company stocks also dropped 0.3 percent to 1,575.55.
ENERGY: U.S. crude added 23 cents to $57.45 per barrel in electronic trading on the New York Mercantile Exchange. It finished 28 cents higher at $57.22 a barrel overnight. Brent crude, used to price international oils, gained 31 cents to $66.62 a barrel. The contract gave up 27 cents to $66.31 in London.
CURRENCIES: The dollar strengthened to 111.71 yen from 111.39 yen on Thursday. The euro eased to $1.1370 from $1.1371.
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