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GLOBAL MARKETS-Asian stocks climb but dearth of trade details caps gains

Published 12/17/2019, 08:17 AM
Updated 12/17/2019, 08:24 AM
GLOBAL MARKETS-Asian stocks climb but dearth of trade details caps gains
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* Trade deal sends stocks higher, but details awaited
* Nikkei hits highest since Oct. 2018, ASX edges up
* Pound slips as hard Brexit fears re-emerge
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Tom Westbrook
SYDNEY, Dec 17 (Reuters) - Asian shares gained on Tuesday,
but a lack of detail about the Sino-U.S. trade deal tempered
some of the exuberance that sent Wall Street to record highs
overnight, while familiar fears of a hard Brexit knocked the
pound.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS rose 0.1%. Japan's Nikkei .N225 rose half a
percent to its highest in more than year. Australia's S&P/ASX
200 .AXJO eked a tiny extension to Monday's big gains.
Bond markets, currencies and commodities were more
circumspect than equities, and movements were slight.
"Everyone expected the U.S. was never going to put the new
tariffs on, it was hurting them as much as anyone else," said
Mathan Somasundaram, portfolio strategist at stockbroker Blue
Ocean Equities in Sydney. "But markets are fairly stretched, we
need to have better data to drive growth optimism."
The preliminary deal between Washington and Beijing will
double U.S. exports to China, White House adviser Larry Kudlow
told Fox News overnight. The United States will also reduce some
tariffs on Chinese goods under the agreement. It is not yet signed, and the Chinese side have been more
circumspect in their praise, but U.S. Trade Representative
Robert Lighthizer said over the weekend it is "totally done".
The three major U.S. stock indices rose modestly, but posted
record closing highs. So did the pan-European STOXX 600 index
.STOXX . .N .EU
The Dow Jones Industrial Average .DJI rose 0.4%, the S&P
500 .SPX added 0.7% and the Nasdaq .IXIC almost one
percentage point. For the year to date, the Nasdaq has increased
its value by a third, while the other indicies are up by more
than 20%.
In Britain, the FTSE 100 .FTSE had its biggest daily gain
in almost a year. But after the closing bell some familiar fears
returned. ITV reported Prime Minister Boris Johnson would use his huge
majority to reinstate a hard deadline for quitting the European
Union at the end of next year, again raising the spectre of a
chaotic "hard" Brexit. Sterling GBP= fell 0.6%.

WHAT'S ACTUALLY IN IT?
Elsewhere currency markets were more circumspect in the
absence of many of the fine details of the trade deal. The U.S
dollar recouped some of Monday's losses, though moves were
modest.
"Well, yeah, they've agreed a phase one deal, but what's
actually in it?" said Westpac analyst Imre Speizer.
"Equity markets just want to rally, so they'll pick on
anything that seems remotely positive, but the other markets are
maybe a little more thoughtful about exactly what's going on."
Several Chinese officials told Reuters the wording of the
agreement remained a delicate issue and care was needed to
ensure expressions used in text did not re-escalate tensions.
Still, trade optimism kept the Chinese yuan on the strong
side of 7 per dollar CNH= .
The Australian dollar AUD=D3 drifted lower ahead of the
release of central bank meeting minutes that will provide clues
as to the thinking about further monetary easing in 2020.
Brent crude LCOc1 held steady at $65.29 per barrel, after
climbing overnight. Spot gold XAU= was flat at $1,475.32 per
ounce.

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