Asian shares rally on U.S.-China trade thaw

SHANGHAI (Reuters) – Asian equity markets rallied on Thursday on signs of easing Sino-U.S. trade tensions and expectations that China will step up efforts soon to support its cooling economy.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.8 percent, building on early gains made after British Prime Minister Theresa May survived a no-confidence vote.

Financial spreadbetters expect shares in Europe to follow suit, with Frankfurt’s DAX seen opening 0.3 percent higher at 10,963 and Paris’ CAC expected to gain 0.2 percent. London’s FTSE is seen flat.

U.S. stock futures rose 0.4 percent, pointing to a firmer opening on Wall Street.

In Asia, gains were concentrated in Chinese shares, with Chinese blue-chips up 1.5 percent and Hong Kong’s Hang Seng index gaining 1.1 percent.

Japan’s Nikkei stock index ended 1 percent higher, while Australian shares gained 0.1 percent.

Markets are slowly growing less pessimistic about the chances of a Sino-U.S. trade deal after a slew of news this week pointed to easing tensions between the two powers.

Reuters reported on Wednesday that Chinese state-owned companies have bought more than 1.5 million tonnes of U.S. soybeans in the first major U.S. soybean purchases in more than six months.

The purchases are the most concrete evidence yet that China is making good on pledges made when Presidents Donald Trump and Xi Jinping met on Dec. 1 and agreed to a 90-day detente to negotiate a trade deal.