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Asian Markets Advance On U.S.-China Trade Optimism


Asian stock markets are in positive territory on Wednesday despite the mixed cues from Wall Street amid optimism about U.S.-China trade relations. News that China plans to cut tariffs on U.S.-made cars and that a Canadian court has granted bail to Chinese telecom giant Huawei's CFO Meng Wanzhou boosted investor sentiment.

In an interview with Reuters, U.S. President Donald Trump expressed optimism he could strike a trade deal with Chinese President Xi Jinping and also said he would intervene with the U.S. Justice Department in the case against Wanzhou if it would help close a trade deal with China.

The Australian market is extending gains from the previous session, with stocks mostly gaining across the board.

The benchmark S&P/ASX 200 Index is adding 19.50 points or 0.35 oercent to 5,595.40, after touching a high of 5,601.60 earlier. The broader All Ordinaries Index is up 19.10 points or 0.34 percent to 5,670.30. Australian stocks rebounded from near two-year lows to end modestly higher on Tuesday.

The major miners are higher on stronger industrial metals prices. BHP is adding 0.7 percent, Rio Tinto is advancing 1 percent and Fortescue Metals is higher by more than 1 percent.

In the banking sector, National Australia Bank, ANZ Banking, Westpac and Commonwealth Bank are rising in a range of 0.3 percent to 0.9 percent.

Oil stocks are also higher after crude oil prices rebounded more than 1 percent overnight. Santos is higher by more than 1 percent, Woodside Petroleum is up almost 1 percent and Oil Search is adding 0.3 percent.

Bucking the trend, gold miners are weak after gold prices edged lower overnight. Evolution Mining is losing almost 2 percent and Newcrest Mining is lower by 0.4 percent.

Sonic Healthcare said it is acquiring U.S. pathology services provider Aurora Diagnostics in a A$750 million deal. The company's shares are in a trading halt for a capital raising to fund the acquisition.

Among others in the healthcare sector, CSL is adding 0.6 percent and Resmed is higher by more than 1 percent, while Cochlear is declining more than 1 percent.

Vita Group said it has extended its deal to run Tesltra-branded retail stores through June 30, 2024. Shares of Vita Group are declining almost 1 percent, while Telstra shares are losing more than 1 percent.

On the economic front, Australia will see December results for the consumer confidence index from Westpac today.

In the currency market, the Australian dollar is edging higher against the U.S. dollar on Wednesday. The local currency was quoted at $0.7211, up from $0.7204 on Tuesday.

The Japanese market is advancing despite the mixed cues from Wall Street, amid optimism about U.S.-China trade relations.

The benchmark Nikkei 225 Index is rising 349.22 points or 1.65 percent to 21,497.24, after rising to a high of 21,535.30 earlier. Japanese shares fell modestly on Tuesday to close near their lowest level since March.

The major exporters are notably higher on a weaker yen. Panasonic is gaining almost 4 percent, Mitsubishi Electric is higher by more than 3 percent, Sony is rising more than 2 percent and Canon is adding more than 1 percent.

In the tech sector, Advantest is advancing more than 2 percent and Tokyo Electron is higher by more than 1 percent.

Among the major automakers, Honda and Toyota are adding more than 2 percent each following news that China plans to cut auto tariffs on U.S.-made cars to 15 percent from the current 40 percent. In the banking sector, Mitsubishi UFJ Financial is adding almost 1 percent and Sumitomo Mitsui Financial is up 0.5 percent.

In the oil space, Inpex is higher by almost 2 percent and Japan Petroleum is edging up 0.1 percent after crude oil prices rebounded overnight.

Among the other major gainers, Toto is gaining almost 6 percent, while Yamaha Corp. and Tokyo Electric Power are rising more than 5 percent each. Showa Denko is advancing almost 5 percent.

On the flip side, Konami Holdings is declining almost 2 percent, while Pioneer Corp. and East Japan Railway are lower by more than 1 percent each.

In economic news, the Cabinet Office said that core machine orders in Japan were up 7.6 percent on month in October, worth 863.2 billion yen. That was shy of expectations for an increase of 9.7 percent following the 18.3 percent plunge in September.

The Bank of Japan said that producer prices in Japan were down 0.3 percent on month in November. That missed expectations for a decline of 0.1 percent following the 0.4 percent increase in October.

In the currency market, the U.S. dollar is trading in the mid 113 yen-range on Wednesday.

Elsewhere in Asia, South Korea and Hong Kong are advancing more than 1 percent each, while New Zealand and Taiwan are adding almost 1 percent each. Shanghai, Indonesia and Malaysia are also higher.

On Wall Street, stocks closed mixed on Tuesday in a volatile session as traders waffled between optimism and skepticism about a potential trade agreement between the U.S. and China. A testy public exchange between Trump and top Democratic leaders over funding for his proposed border wall may have also raised concerns about a partial government shutdown.

While the tech-heavy Nasdaq rose 11.31 points or 0.2 percent to 7,031.83, the Dow dipped 53.02 points or 0.2 percent to 24,370.24 and the S&P 500 edged down 0.94 points or less than a tenth of a percent to 2,636.78.

The major European markets showed strong moves to the upside on Tuesday. While the German DAX Index surged up by 1.5 percent, the French CAC 40 Index and the U.K.'s FTSE 100 Index jumped by 1.4 percent and 1.3 percent, respectively.

Crude oil futures rebounded to close higher on Tuesday, aided by an unexpected supply cut from Libya. WTI crude rose $0.65 or 1.3 percent to close at $51.65 a barrel on the New York Mercantile Exchange.

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