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Wall Street and European markets rebounded on reports China and the US will renew their negotiations in an attempt to diffuse their escalating trade spat.
Markets at 7:20am (AEST):
- ASX SPI 200 futures flat at 6,280, ASX 200 (Thursday's close) flat at 6,328
- AUD: 72.59 US cents, 57.04 British pence, 63.79 Euro cents, 80.46 Japanese yen, $NZ1.10
- US: Dow Jones +1.6pc at 25,559, S&P 500 +0.8pc at 2,841, Nasdaq +0.4pc at 7,806
- Europe: FTSE +0.8pc at 7,556, DAX +0.6pc at 12,237, CAC +0.8pc at 5,349, Euro Stoxx 50 +0.6pc at 3,378
- Commodities: Brent crude +0.8pc at $US71.35/barrel, spot gold -0.1pc at $US1,173.56/ounce, iron ore -1pc at $US66.51/tonne
The trade talks will be conducted by lower-level officials from both countries, and are expected to take place on August 21 and 22 in Washington.
They are timed just before America's $US16 billion worth of tariffs on Chinese goods — and Beijing's retaliatory tariffs on that amount of US imports — take effect.
A Chinese delegation led by Vice Minister of Commerce Wang Shouwen will meet US representatives led by Treasury under secretary for international affairs David Malpass, according to a statement on China's Ministry of Commerce website.
Dow's best day in four months
Optimistic investors drove the Dow Jones index higher by 396 points, or 1.6 per cent to 25,559 — its biggest one-day jump since April 10.
The Dow was boosted by a 9.3-per-cent lift in the share price of America's largest retailer Walmart, after it posted quarterly earnings which surpassed market expectations.
The blue-chip index was also helped by US industrial giants Boeing and Caterpillar jumping 4.3 and 3.2 per cent, respectively, on the trade developments.
Both companies are highly sensitive to news about trade disputes as they earn a substantial part of their revenue from outside the US.
The S&P 500 and Nasdaq indices gained 0.8 and 0.4 per cent respectively.
Second-quarter reporting season is winding down, with 93 per cent of the S&P 500 companies having posted earnings — and 79 per cent of them exceeding estimates, according to Thomson Reuters data.
Australian market today
Australian shares are expected to start the day largely unchanged, with ASX futures trading flat despite the strong lead from global markets.
The Australian dollar had lifted slightly, back to 72.6 US cents at 7:00am AEST.
"Risk sentiment improved following news that the US and China will resume trade talks later this month," ANZ's Daniel Gladwell said.
"This, along with the tick down in the unemployment rate seen yesterday, has lifted the Australian dollar to the top of the G10 performance."
Commodity markets also recovered, with solid gains in the prices of zinc (+4pc), lead (+5.9pc), copper (+1.8pc), aluminium (+1.1pc).
Brent crude oil rose 0.8 per cent, recouping some of their sharp losses from earlier this week.
Topics: business-economics-and-finance, company-news, markets, stockmarket, currency, trade, australia, united-states
First posted