SYDNEY: Asian stocks bounced with US equity futures Wednesday after a report that the US and China have ironed out most of their differences in trade negotiations. Treasury yields headed back toward 2.5%.
The Financial Times reported that while the US and China were still working out some trade enforcement issues, their officials have resolved most of those surrounding the deal.
Equities in Japan and Seoul erased earlier declines. Shares in Sydney gained and the Australian dollar reversed losses as bonds declined.
Earlier, a dearth of leads from Wall Street overnight gave no fresh impetus for global equities to extend gains after a strong first quarter.
The S&P 500 Index ended little changed after being lower most of the session. The pound fluctuated after Theresa May announced a proposal to break the logjam over Brexit.
Global equities have struggled to push higher after beginning the week strong, building on the best quarter since 2010 after encouraging American and Chinese manufacturing data.
The trade talks are set to regain focus for investors, with Chinese Vice Premier Liu He leading a delegation of negotiators to Washington on Wednesday.
“We’re still in a state of flux and I think investors are just looking for any positive sign to sustain the rally or at least put a floor underneath where we are in the marketplace,” said Tom Stringfellow, president at Frost Investment Advisors, which has US$3.68 billion in assets under management.
Elsewhere, oil traded near a four-month high in New York as a further retreat in Opec’s production signalled that global markets are tightening. In the UK, May’s plan is to get a cross-party approach on the future relationship with the EU, secure Labour support for her divorce deal and thereby lock in the date of May 22 to leave the bloc.