Asian Shares Rise As Trade War Fears Ebb

Asian stocks moved mostly higher on Friday as trade-war fears receded and investors awaited the latest U.S. jobs report to gauge the economic impact of the coronavirus-induced lockdown.

According to analyst estimates, U.S. employment is expected to plunge by about 22 million jobs in April, driving the unemployment rate up to 14.0 percent.

Chinese shares rose after reports suggested U.S. and Chinese trade representatives held a phone call and pledged to create favorable conditions for the implementation of the phase one trade deal signed in January.

The benchmark Shanghai Composite Index climbed by 23.82 points, or 0.8 percent, to 2.895.34, while Hong Kong’s Hang Seng Index jumped 249.54 points, or 1 percent, to 24,230.17.

Japanese shares moved sharply higher on reports the government is mulling a plan to help small businesses cover two-thirds of their rent in the next six months.

Markets ignored dire economic data showing that the services sector in Japan continued to contract in April, and at a much more severe rate.

According to the latest survey from Jibun Bank, the services PMI score slid to 21.5 from 33.8 in March amid a collapse in demand.

Separately, official data showed that the average of household spending in Japan fell an annual 6.0 percent in March.

The Nikkei 225 Index rallied 504.32 points, or 2.6 percent, to 20,179.09, while the broader Topix closed 2.2 percent higher at 1,458.28.

Market heavyweight SoftBank Group surged 3.9 percent and Fast Retailing, owner of casual clothing chain Uniqlo, gained 3.3 percent.

Exporters ended broadly higher, with Honda Motor and Nissan Motor climbing 5.7 percent and 4.2 percent, respectively. Toyota Motor, Canon, Sony and Panasonic rose between 1.2 percent and 2.4 percent.

Australian markets pared some of their early gains after the Reserve Bank of Australia predicted the economy would log its biggest contraction in history due to the coronavirus pandemic.

In its quarterly Statement on Monetary Policy, the central bank said gross domestic product would likely contract around 10 percent over the first half of 2020, mostly concentrated in the June quarter.

The benchmark S&P/ASX200 Index ended up 26.90 points, or half a percent, at 5,391.10, while the broader All Ordinaries Index rose 38.10 points, or 0.7 percent, to 5,488.

Mining heavyweights BHP and Rio Tinto rose 1.3 percent and 1.8 percent, respectively, while smaller rival Fortescue Metals Group jumped 5.2 percent.

Energy companies Woodside Petroleum and Santos gained 1-2 percent, while banks ended broadly lower.

Macquarie Group soared 5.7 percent despite the investment bank slashing its dividend and warning of challenging market conditions.

AMP rallied 3.3 percent after the wealth management giant dumped plans to divest its New Zealand wealth management operations.

Telstra lost about 1 percent as it announced an AU$300 million write-down of its 35 percent stake in Foxtel.

Seoul stocks closed higher as investors cheered data showing a steady decline in U.S. jobless claims over the past five weeks. Unemployed U.S. workers filed 3.2 million new claims for jobless benefits last week, the fewest since the week ended March 14 but still fifteen-times early March readings.

Better than expected exports data from China, the top trading partner of South Korea, also helped boost investor sentiment.

The benchmark Kospi advanced 17.21 points, or 0.9 percent, to finish at 1,945.82. Market heavyweight Samsung Electronics ended on a flat note, while No. 2 chipmaker SK Hynix advanced 3.2 percent.

New Zealand shares rose, with consumer leisure sectors finding support as the country begins to ease restrictions and gears up to open the economy again. The benchmark NZX-50 Index rose 0.4 percent to 10,695.59. Pay-TV operator Sky Network Television led the market higher, climbing 6.7 percent to 32 cents.

Malaysia’s KLSE Composite Index rose 0.4 percent. The country’s unemployment rate rose to 3.9 percent in March from 3.3 percent in February, a government report showed. In the same month last year, the unemployment rate was 3.4 percent.

U.S. stocks ended firmly in positive territory overnight as optimism about a gradual reopening of businesses and an announcement from biotech company Moderna that it has accelerated plans to develop an experimental vaccine for COVID-19 helped investors shrug off data showing jobless claims remain at an elevated level.

The Dow Jones Industrial Average rose 0.9 percent and the S&P 500 gained 1.2 percent, while the tech-heavy Nasdaq Composite surged 1.4 percent to return to positive territory for 2020.

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