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GLOBAL MARKETS-Asia shares relieved by trade lull, sterling up on Brexit deal hopes

Published 2018-09-10, 08:25 p/m
© Reuters.  GLOBAL MARKETS-Asia shares relieved by trade lull, sterling up on Brexit deal hopes
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* Asian stock markets : https://tmsnrt.rs/2C2BSt0

* Asia shares ex Japan steady above 14-mth low, Nikkei firms

* Welcome break in tariff hostilities, even if temporary

* Sterling holds gains on hopes for a Brexit deal with EU

By Wayne Cole

SYDNEY, Sept 11 (Reuters) - Asian shares were struggling to snap an eight-session losing streak on Tuesday as investors decided no news was good news on tariffs, while the pound touched a five-week top on hints a Brexit deal might be nearer.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS wavered either side of flat having hit its lowest since July last year on Monday.

Japan's Nikkei .N225 fared better on the back of a softer yen and climbed 0.6 percent.

Having warned last week that he was ready to levy additional taxes on practically all Chinese imports, U.S. President Donald Trump was uncharacteristically quiet on trade on Monday.

"Although the end of the $200bn consultation period ended without much clarity, there was no very strong escalation and APAC equities had declined significantly into the event," wrote analysts at JPMorgan (NYSE:JPM) in a note.

China has cautioned it will respond if the United States takes any new steps on trade. Foreign Minister Chrystia Freeland will meet the U.S. Trade Representative in Washington on Tuesday for another round of talks to renew the NAFTA trade pact. Wall Street, the Nasdaq eked out gains to end four sessions of losses but stocks of insurers slipped as Hurricane Florence barrelled toward the U.S. east coast. Dow .DJI fell 0.23 percent, while the S&P 500 .SPX gained 0.19 percent and the Nasdaq .IXIC 0.27 percent. .N

BETTING ON BREXIT

In currency markets, sterling stood out after the European Union's top negotiator said an agreement for Britain to leave the economic bloc might be reached in the coming weeks.

The pound has been under pressure on anxiety that Britain would exit from the EU without any formal trading arrangement.

Sterling GBP=D3 clambered up to $1.3024, after firming 0.8 percent overnight. euro EUR=EBS edged up to $1.15965, aided in part by an easing in concerns over Italian debt which left the gap between yields on Italian and more creditworthy German bonds at the narrowest in a month.

Against a basket of major currencies the dollar .DXY was flat at 95.168. It was a shade firmer on the yen at 111.14 JPY= , but well within recent ranges.

Emerging market currencies remained under pressure with a broad index .MIEM00000CUS down near 16-month lows and the Indian rupee INR= near a record trough of 72.675 per dollar,

"Weakness is set to remain a recurring theme amid global trade tensions, a broadly stronger dollar and prospects of higher U.S. interest rates," said Lukman Otunuga, a research analyst at broker FXTM.

"With turmoil in Turkey and Argentina triggering contagion fears, appetite for emerging market assets and currencies is likely to continue diminishing."

In commodity markets, gold was stuck at $1,195.40 an ounce XAU= and continues to move in the opposite direction of the dollar.

Oil prices were subdued after data suggested U.S. crude inventories might build, weighing on the market. O/R

Brent was 3 cents firmer at $77.40 a barrel LCc1 , while U.S. crude inched up 3 cents to $67.57 CLc1 .

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ MSCI and Nikkei chart

http://reut.rs/2sSBRiD Asian stock markets :

https://tmsnrt.rs/2C2BSt0 Global assets' performance

https://tmsnrt.rs/2BX92de World FX rates in 2018

http://tmsnrt.rs/2egbfVh

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