Asia: Markets mixed as China-US talks end, eyes on tech earnings
[HONG KONG] Asian markets were mixed on Wednesday as investors kept tabs on China-US developments after they agreed to further talks to extend their trade truce, while eyes were also on tech earnings and a key Federal Reserve meeting.
After deals were reached with the European Union and Japan over the past week, focus has been on negotiations between Washington and Beijing to extend an agreement to lower eye-watering tariffs that threatened the world’s top economies.
The two-day meeting in Stockholm ended without a resolution but with the US team voicing optimism they could announce a second 90-day truce.
Neither side has made public any details, although US Trade Representative Jamieson Greer said President Donald Trump would have the “final call” on any extension.
Treasury Secretary Scott Bessent called the tone of the talks “very constructive”.
Chris Weston at Pepperstone said: “Progress on a further extension remains the well-subscribed base case, but Trump holds the final call on that, and we note there is still ample time until we reach the deadline of 1Aug 12.
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“For now, the markets are unperturbed by what they hear and have a further impending 90-day extension fully priced.”
The general feeling is that the moratorium will be extended but there remains some nervousness, with many other countries still to reach agreements ahead of Trump’s Aug 1 deadline.
In early Asian trade, Tokyo was flat, while Hong Kong, Singapore and Manila were down and Shanghai, Sydney, Seoul, Wellington, Taipei and Jakarta rose.
Among those countries still to reach a deal are Brazil and India, with the South American giant facing the threat of 50 per cent tariffs.
On Tuesday, the president said New Delhi could face a 20 to 25 per cent rate, adding: “India has been a good friend, but India has charged basically more tariffs than almost any other country.
“You just can’t do that.”
Major earnings releases from tech titans Meta and Microsoft are due on Wednesday, with Amazon and Apple coming on Thursday.
“It’s been a solid US reporting season so far, but these mega-cap names need to run it hot and blow the lights out, given the bar to please has been sufficiently raised,” Pepperstone’s Weston said.
As well as the results, focus will be on the firms’ forecasts in light of Trump’s tariffs and their colossal investments in artificial intelligence.
The Fed is widely expected to stand pat on interest rates on Wednesday, but investors will be looking for any hint of a cut in September after recent economic data indicated some softening in the labour market.
Oil prices held Tuesday’s gains of more than three per cent - their biggest in six weeks, according to Bloomberg News - after Trump reiterated his warning of fresh sanctions on Russia unless it reaches a truce deal with Ukraine. AFP
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