By Wayne Cole
SYDNEY (Reuters) – Asian stocks crept to a three-month peak on Tuesday after Wall Street hit highs all the time amid hopes of Chinese-American trade talks and another dose of political stimulus from Federal Reserve this week.
Japanese Nikkei () led the way with an increase of 0.4% to reach the ground last thought a full year ago, while Shanghai blue chips () each danced on its side of the flat.
MSCI's broadest equity index in Asia and the Pacific off Japan () reached 0.2%, touching the highest since the end of July. E-Mini futures for the S&P 500 () increased the gain by 0.1
U.S. President Donald Trump said Monday that he expected to sign a significant portion of a trade agreement with China ahead of schedule, but did not elaborate on the time.
The US Commerce Representative also said that the United States is studying whether to extend the $ 34 billion Chinese goods tariff suspension that expires December 28 of this year.
"The market appears to interpret the improvement in trade talks as a positive sign that the United States will suspend the planned US $ 160 billion tariff on Chinese imports due to take place in December," said Rodrigo Catril, a senior FX strategist at National Australia Bank.
"This is a great precondition as conversations can easily fail again if both parties cannot find a compromise."
On Wall Street, the S&P 500 () gained 0.56% to reach a record-breaking peak, while Dow ( ) rose 0.49% and Nasdaq () 1.01%.
Microsoft Corp. (O 🙂 climbed 2.46% after winning Pentagon's $ 10 billion cloud computing contract, beating Amazon.com Inc (O :).
Google parent Alphabet Inc (O 🙂 slipped in late trading in NY after missing analysts' quarterly earnings estimates, even though revenue growth exceeded expectations.
WAITING FOR THE FAT
The embrace of risk left bonds out in the cold, and the yield on two-year government bonds hit a four-week high of 1.667%.
Bond investors look forward to a likely Federal Reserve interest rate cut on Wednesday, though they also suspect officials may signal caution in moving forward.
"Our baseline case is that the Fed will cut again in December, although Fed communications may sound marginally more hawkish this week, and we expect the FOMC to keep its door open once again this year instead of explicitly signaling it , ”analysts at JPMorgan (NYSE 🙂 wrote in a note.
The futures market has 50 basis points of approx. ut priced by June.
The central banks in Japan and Canada also meet this week, with the former being able to be further facilitated if only to prevent an export-sapping return in its currency.
The shift from safe harbors served to weaken the yen. The US dollar was at 108.98 yen, when it reached its highest in three months, and had a high of 109.31.
The euro went less well, ending up at $ 1.1095 (), and was little changed on a currency basket of 97.782 ().
Sterling fired after the EU agreed to a Brexit delay of up to three months, while Prime Minister Boris Johnson lost a vote to force elections on December 12.
pounds were last at $ 1.2852, well above the low for the month at $ 1.2193.
slipped to $ 1,491.48 per ounce, and off last week's peak around $ 1,517.
Oil prices were pushed by signs of rising US crude.
Brent crude () futures slipped 24 cents to $ 61.33 a barrel, while US crude () lost 24 cents to $ 55.57.