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GLOBAL MARKETS-Shares firm, oil near 2-month high after deeper output cut

Published 06/12/2019, 01:38
Updated 06/12/2019, 01:45
© Reuters.  GLOBAL MARKETS-Shares firm, oil near 2-month high after deeper output cut
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* Trump still upbeat on deal despite gap over tariffs

* Oil prices hold at recent highs as OPEC+ deepens cuts

* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Hideyuki Sano

TOKYO, Dec 6 (Reuters) - Asian stocks held firm on Friday as

U.S. President Donald Trump's rhetoric kept investors' hopes up

on a trade deal with China, while oil sat near two-month highs

after producers led by Saudi Arabia and Russia agreed on further

output cuts.

Japan's Nikkei .N225 rose 0.28% and MSCI's broadest index

of Asia-Pacific shares outside Japan .MIAPJ0000PUS was up

0.19%. Australian shares .AXJO rose 0.24%, while South Korea's

Kospi .KS11 rose 0.57%.

Trump said on Thursday that U.S.-China trade talks are

"moving right along," striking an upbeat tone despite a lack of

agreement over whether existing tariffs should be dropped as

part of a deal. Investors were hoping that the two sides will reach a

compromise to at least avoid their worst fears - that the United

States will go ahead with its final batch of tariffs on about

$156 billion of Chinese exports.

Uncertainties over a deal have pushed some investors to the

sidelines in recent sessions, while nervousness ahead of the

release of U.S. payrolls data later in the day could also dampen

trade on Friday.

Oil prices stood little changed near recent peaks after

major oil exporting countries agreed on Thursday to cut output

by an extra 500,000 barrels a day in the first quarter of 2020,

after a nearly six-hour meeting on Thursday.

Details of the agreement and how the cuts will be

distributed among producers still need to be ratified at a

meeting in Vienna of OPEC and non-OPEC nations, or so-called

OPEC+, on Friday.

"The cut of an extra 500,000 barrels a day was not priced

into the market, so the cut will be positive for the market if

it is carried out," said Tatsufumi Okoshi, senior commodity

economist at Nomura.

"But since OPEC countries haven't fully complied with the

existing cut, markets will probably have to wait to see how the

cut will pan out," he added.

U.S. West Texas Intermediate (WTI) crude CLc1 dipped 2

cents to $58.41 per barrel, but was not far off Thursday's

2-1/2-month high of $59.12 per barrel.

The agreement coincided with the initial public offering

(IPO) of state oil firm Saudi Aramco, which was priced at the

top of its range, raising $25.6 billion in the world's biggest

IPO. In the currency market, the British pound soared on growing

confidence that next week's election will give the Conservative

Party the parliamentary majority it needs to deliver Brexit,

ending near-term uncertainty. Sterling spiked to a seven-month high of $1.3166 on Thursday

and last stood at $1.3157 GBP=D4 , up 1.6% so far this week. It

hit 2-1/2-year highs versus the euro.

The euro stood at $1.1107 EUR= , near a one-month high of

$1.11165 set on Wednesday, helped by firmer euro zone economic

data.

That helped push the dollar index =USD to a one-month low

of 97.356 on Thursday. The index last stood at 97.386.

Against the yen, the dollar traded at 108.73 yen JPY= ,

having slipped slightly the previous day.

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