Asian stocks rise on optimism over easing of COVID restrictions | Company

TOKYO (AP) — Asian stocks rose across the board on Monday as buying took hold after a U.S. national holiday lull.

Analysts said the optimism could be driven by expectations that the United States might decide to cut Chinese tariffs, a welcome move that would also help tame inflation.

China’s Commerce Ministry said on Tuesday that Vice Premier Liu He had spoken with Treasury Secretary Janet Yellen about coordinating economic policy between the two largest economies and maintaining the stability of the chains. supply.

In a statement, he also said that the Chinese side “expressed concern over issues such as the removal of additional tariffs and sanctions imposed by the United States on China and the fair treatment of Chinese enterprises.” Both sides agreed to continue their talks, he said.

Investors were also encouraged by the lifting of restrictions related to the coronavirus pandemic in the region, including in Japan, which had exploded with foreign tourists before the pandemic.

“Yesterday’s calm economic calendar causes sentiment to focus on the sole headline of relief from a possible U.S. tariff easing move, which could run the risk of a sharp reduction in bullish speculative betting in the event inaction,” in controlling inflation,” Yeap Jun Rong, market strategist at IG in Singapore, said in a comment.

But risks remain due to inflation and slowing economic activity in some countries. A resurgence of COVID-19 infections in Europe, the United States and parts of Asia is also looming, raising the threat of a return to pandemic precautions.

Japan’s benchmark Nikkei 225 added nearly 1.0% in morning trade to 26,404.90. Australia’s S&P/ASX 200 rose 0.3% to 6,632.00. South Korea’s Kospi jumped 1.8% to 2,342.24. Hong Kong’s Hang Seng gained 0.8% to 21,997.04, while the Shanghai Composite edged up 0.1% to 3,409.95.

Market participants are also closely watching an interest rate decision from the Reserve Bank of Australia. It should raise its key rate by 50 basis points. Minutes from the Federal Reserve’s latest policy meeting are also due out on Wednesday and could provide some guidance on future policy.

Global investors are worried about soaring inflation and the possibility that higher interest rates could trigger a recession in some economies. The US trade was closed on Monday for Independence Day.

Dow Jones and S&P 500 futures both rose 0.4% early Tuesday.

Stocks ended last week on a rally, with the S&P 500 jumping 1.1%. The Dow gained 1% and the Nasdaq rose 0.9%. The Russell 2000 Small Business Index gained 1.2%.

In the first half of this year, the S&P 500 posted its worst performance since the first six months of 1970. It is now down 20.2% from its peak at the start of this year.

The risk of a recession simmers as the US Federal Reserve aggressively raises interest rates. The Fed is raising rates to deliberately slow economic growth to calm inflation, but could potentially go too far and trigger a recession.

In Germany, Chancellor Olaf Scholz brought together key employer and union representatives in his Berlin office on Monday to explore ways to deal with the impact of rising prices while preventing an inflationary spiral in the biggest economy. from Europe.

In energy trading, benchmark U.S. crude jumped $1.87 to $110.30 a barrel. It gained $2.67 on Friday to $108.43 a barrel. Trading was closed on Monday. Brent crude, the international standard, fell 3 cents to $113.47 a barrel.

In currency trading, the US dollar rose slightly to 136.15 Japanese yen from 135.69 yen. The Euro traded at $1.0434, down from $1.0423 previously.

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Yuri Kageyama is on Twitter https://twitter.com/yurikageyama

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