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Asian stock markets led gain in emerging markets as trade tensions ease

Devdiscourse News Desk
Updated: 12-12-2018 16:12 IST

Asian stock markets led gains in emerging markets on Wednesday as signs of an easing of U.S.-China trade tensions boosted investors' appetite for risk, while the dollar held near a one-month high, capping gains in many developing world currencies.

In an interview with Reuters, President Donald Trump sounded upbeat on the chances of a trade deal with China and said he would intervene with the U.S. Justice Department in the case against a Chinese telecommunications executive if it would help.

Huawei Technologies Co's Chief Financial Officer Meng Wanzhou, who was arrested earlier this month in Vancouver on charges of violating U.S. sanctions against Iran, was released on bail on Tuesday, easing concern among financial investors that the case could lead to more tit-for-tat moves by Beijing and Washington.

MSCI's index for developing world stocks climbed 1 per cent, with Chinese and Hong Kong shares both closing higher.

South Korea's main index rose 1.4 per cent, buoyed by gains in shares of the country's biggest carmaker, Hyundai Motor Co.

"The trade news has helped stock markets in Asia rise," said William Jackson, chief emerging market economist at Capital Economics in London.

"Part of the rebound in equities reflects how sharply they fell earlier this week. We may just be seeing a recovery (but) obviously there's been a big element in the news flow."

Indian stocks rallied after the government moved quickly to calm markets and appoint a new central bank governor, picking a former finance ministry official and backer of some of Prime Minister Narendra Modi's key policies.

The prospect of a swing towards the more dovish policy demanded by Modi's administration ahead of next year's elections helped stock markets, but concerns remain among investors about the independence of the bank.

Stocks on Johannesburg's main index were at a one-week high after data showed consumer inflation quickened slightly in November in Africa's most industrialised nation. That also boosted the rand.

Other emerging market currencies were mixed as the dollar recovered from sharp falls last week, with the Russian rouble and Turkey's lira weakening. Most Asian currencies including the Chinese yuan and the Indian rupee firmed.

For GRAPHIC on emerging market FX performance 2018, see For GRAPHIC on MSCI emerging index performance 2018, see

For TOP NEWS across emerging markets

For CENTRAL EUROPE market report, see

For the TURKISH market report, see

For the RUSSIAN market report, see

(With inputs from agencies.)