Asia stocks track rally in S&P futures
SYDNEY (Reuters) - Asian shares crept higher on Monday as a bounce in US stock futures soothed sentiment even as US President Donald Trump kept up his twitter war with China just a couple of days before President Xi Jinping gives a keynote speech.
There was more confusion than reaction to reports US forces had struck at sites in Syria, reports which the Pentagon quickly denied.
Trump said on Sunday there would be a “big price to pay” after medical aid groups reported dozens of people were killed by poison gas in a besieged rebel-held town.
For now, investors in Asia were encouraged that E-Mini futures for the S&P 500 were still up 0.66 percent, while NASDAQ futures rose 0.88 percent.
MSCI’s broadest index of Asia-Pacific shares outside Japan responded by rising 0.7 percent. Japan’s Nikkei put on 0.6 percent, while Chinese blue chips added 0.3 percent and Hong Kong climbed 2 percent.
Caution had been the watchword after Trump claimed on Sunday that China would take down its trade barriers because it was “the right thing to do.”
Trump late Thursday threatened to slap $100 billion more in tariffs on Chinese imports, while Beijing said it was fully prepared to respond with a “fierce counter strike”.
Analysts warned the drama would be a long-running one given the lengthy public discussion period on US tariff proposals meant the earliest they might be imposed was somewhere around late July or early August.
“This is not going to happen tomorrow, and given the mercurial nature of the US administration, the whole issue could well disappear before anything really happens,” said Marshall Gittler, chief strategist at ACLS Global.
“Many market participants may be starting to think that this is just a lot of sound and fury, signifying nothing in the end. But..you never know, US trade policy is in the hands of someone totally unpredictable.”
