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Asia: Most markets up on hopes of China-US trade talks

[HONG KONG] Most Asian markets rose Wednesday on hopes China and the US will resume talks to resolve a deepening trade war, while oil prices held losses after Donald Trump's offer for Iran talks.

Wall Street provided a positive lead, with upbeat earnings coming on top of a Bloomberg News report that Washington and Beijing were looking to discuss the tariffs row that has fuelled fears of an all-out trade war between the world's top two economies.

On Tuesday reports said the White House was considering hiking to 25 per cent its planned 10 per cent tariffs on US$200 billion worth of Chinese goods that have been targeted.

Tariffs on US$16 billion of Chinese imports are due in coming weeks, following measures on US$34 billion worth of goods imposed in July, which prompted a response in kind by Beijing.

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"The tariff issue is ongoing, I think it's a negotiating tactic," Nick Griffin, chief investment officer at Munro Partners, told Bloomberg Television.

"How much we take of this as real and affecting earnings is questionable at this stage. In terms of an actual earnings effect, it's not that big at the moment, it's mainly just sentiment and risk appetite and for that it's a moving feast."

In morning trade Hong Kong was up 0.4 per cent and Shanghai added 0.2 per cent while Tokyo went into the break 0.5 per cent higher.

Seoul gained 0.4 per cent, Taipei put on 0.2 per cent and Jakarta rallied 0.7 per cent, though Sydney dipped slightly and Singapore was flat.

Suppliers to Apple performed well after the US giant announced better-than-forecast profits. Foxconn climbed 1.3 per cent in Taipei, Japan Display rallied almost three percent in Tokyo and Seoul-listed LG Display was 1.7 per cent higher.

On currency markets the yen struggled to bounce back from Tuesday's drop after the Bank of Japan tweaked monetary policy but held off on any major tightening measures, while revising down inflation expectations.

Stephen Innes, head of Asia-Pacific trading at Oanda, said: "The BoJ announced minuscule adjustments. Traders view incredibly subtle shift towards policy normalisation as definitively dovish and topside (for the dollar) is now in play."

Oil prices extended the previous day's drop after Trump's offer for talks with Tehran Monday to resolve the nuclear row. Crude has risen in recent months on worries that supplies would be cut off by the US decision to pull out of a global accord with Iran over its atomic programme and reimpose sanctions.

Traders are also waiting for the release later in the day of a closely watched US crude inventories report seen as a barometer for supply and demand in the world's top oil consuming nation.

AFP