NEW YORK: Asian shares rose in a cautious start to the week as investors await progress in US trade negotiations with the region and signs of further stimulus from China.
A regional gauge advanced 0.5 per cent - posting its seventh gain in eight days - while futures for the S&P 500 declined 0.5 per cent. Gold dropped as much as 1.2 per cent as traders unwound positions on signs the the metal’s rally may have run too far and too fast. Treasuries and the dollar were steady.
Amid Asia’s busiest earnings week this season, investors will also focus on key economic data- the Bank of Japan’s rate decision, and US jobs report and gross domestic product data - to see if the the recent steadiness in markets will continue as tariff tensions tamp down. Traders are also taking some comfort from hopes that the Federal Reserve may reduce interest rates earlier than expected.
"Market is getting more sanguine in recent weeks but I’m more inclined to stay defensive, and stay more oriented to domestic plays across markets,” said Xin-Yao Ng, a fund manager at Aberdeen Investments in Singapore. "The environment will remain highly uncertain and volatile throughout the year, with constant tension around tariffs and geopolitics.”
Traders will also be on watch for any signs of progress in US trade negotiations after President Donald Trump suggested another delay to his higher tariffs was unlikely. Asian nations are likely to strike interim deals to stave off the snapback of the most punitive US tariffs before the 90-day grace period expires in early July.
To help manage the next steps, the Trump team has drafted a framework to handle negotiations with about 18 countries, including a template that lays out common areas of concern to guide the discussions.
US Treasury Secretary Scott Bessent said the Trump administration is working on bilateral trade deals with 17 key trading partners, not including China. Bessent reiterated the administration’s argument that Beijing will be forced to the negotiating table because China can’t sustain Trump’s latest tariff level of 145 per cent on Chinese goods.
Still, some investors doubt that Wall Street’s history of quick resurrections will repeat. They’re sweating over categories of high-frequency data that, while far from front-page news, may provide clues as to whether April’s policy disruption will cause lasting economic pain.
Meanwhile, China’s finance minister Lan Fo’an said the nation will adopt more proactive and effective policies to achieve its growth target and "bring stability and impetus to the global economy,” in a statement posted on the ministry’s Website on Saturday (April 26).
China will hold a press conference on Monday to discuss policies and measures on stabilising employment, ensuring stable growth and promoting high-quality development. No ministers are scheduled to speak at the 10 a.m. meeting in Beijing, which will be hosted by officials at the vice-minister level, according to a notice from the State Council Information Office.
"The real question is around what will be announced - will it be additional stimulus measures or the front-loading of already announced stimulus,” said Tony Sycamore, a market analyst at IG in Sydney. "Until further details are unveiled later today, the market will treat this news cautiously after being burned a number of times over the past six months chasing China stimulus headlines.”
In Japan, shares of Toyota Industries Corp. were untraded and were set to surge by their daily limit of 23 per cent after Bloomberg News reported Toyota Motor Corp. Chairman Akio Toyoda has proposed a buyout of the company. - Bloomberg
