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Asia-Pacific shares advance amid US-China trade optimism



Asia-Pacific equities rose on Monday morning amid optimism on the US-China trade front.

Mainland Chinese stocks rose in early trade, with the Shanghai compound up 0.28% and the Shenzhen component gained 0.62%. The Shenzhen composite also advanced 0.564%. In Hong Kong, the Hang Seng index jumped 1.18% as shares in life insurance company AIA increased by more than 2%.

Elsewhere, South Korea's Kospi advanced 1.33%, with shares of chipmaker SK Hynix jumping 2.17%.

In Australia, the S & P / ASX 200 increased by 0.5%, with almost all sectors in positive territory. However, the heavily weighted financial sub-index decreased by 0.6%. Trading in Westpac shares was halted on Monday after the bank announced the launch of a fundraiser following a 1

6% drop in the statutory net profit for the full year 2019.

September data sales from the Australian Bureau of Statistics on Monday showed retail sales up 0.2% This month, analysts expect a 0.5% rise in analysts in a Reuters poll.

Overall, the MSCI Asia ex-Japan index traded 0.83% higher.

The markets in Japan are closed on Monday for a holiday.

US-China Trade Watch

Investors are following developments on the US-China trade front amid the recent positive trend. US Secretary of Commerce Wilbur Ross said on Sunday that licenses for US companies to sell to Chinese telecommunications giant Huawei will be granted "very soon."

Earlier this year, Huawei was placed with a dozen other Chinese companies on the Department of Commerce's list of alleged national security issues.

Ross also provided more details on the status of an agreement expected to be signed between US President Donald Trump and Chinese President Xi Jinping. Ross said the agreement could be reached by the two leaders at one of several locations, including Iowa, Alaska, Hawaii or a location in China.

The agreement was originally believed to be inked at this Asia-Pacific Economic Cooperation Summit in Chile, an event that has since been canceled due to protests in the country.

Last month, the US and China agreed to complete the first phase of a trade agreement, which includes a break in toll escalation and China buying US agricultural products.

There was still a strategist announcing the prospect of US-China trade.

"As much as US-China trade updates continue to point to a Phase 1 agreement that looks like security, the contentious questions over whether the US will cancel the planned December tariffs and remove some of the current tariffs in line with China's claims are still an unknown and if the problem is not resolved, a deal can easily collapse, "Rodrigo Catril, senior currency strategist at National Australia Bank, wrote in a note.

Meanwhile, shares on Wall Street jumped last Friday, and the S&P 500 reached another record close, rising 1% to 3,066.91. The Nasdaq Composite also hit an all-time high, dropping 1.1% to 8,386.40. The Dow Jones Industrial Average closed 301.13 points higher to 27,347.36.

The features next to it came after much stronger than expected US labor data. The U.S. economy added 128,000 jobs in October, the Labor Department said Friday – despite a decline of 42,000 jobs in the auto sector due to a General Motors strike that has now been settled. Economists polled by Dow Jones had expected a gain of 75,000 jobs.

Currencies and Oil

The US dollar index, which tracks the greenback against a basket of its peers, was at 97,232 following a fall from highs above 97.8 seen last week.

The Japanese yen traded for $ 108.20 against the dollar after seeing a low of 109 over the previous week. The Australian dollar changed hands to $ 0.6912 after rising from levels below $ 0.684 last week.

Oil prices dropped in the morning at Asian trading hours, with the international benchmark index of Brent crude oil futures 0.57% lower to $ 61.34 per barrel. U.S. crude futures also dipped 0.53% to $ 55.90 a barrel.

– CNBC's Emma Newburger and Fred Imbert contributed to this report.


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