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GLOBAL MARKETS-Asian shares firm as "very good" trade talks boost risk appetite

Published 11/10/2019, 02:08
Updated 11/10/2019, 02:10
© Reuters.  GLOBAL MARKETS-Asian shares firm as "very good" trade talks boost risk appetite
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* MSCI Asia ex-Japan +0.5%; Nikkei +0.9%

* Pound eases after rallying on Brexit hopes

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

By Andrew Galbraith

SHANGHAI, Oct 11 (Reuters) - Asian shares and U.S. stock

futures rose on Friday after U.S. President Donald Trump said he

would meet with China's top trade negotiator, while sterling

retreated after rallying on revived hopes of a possible Brexit

deal.

Investors' renewed appetite for riskier assets weighed on

the safe-haven yen JPY= and U.S. Treasury prices, while oil

stayed firm on comments about possible supply cuts from the head

of OPEC.

In early Asian trade, MSCI's broadest index of Asia-Pacific

shares outside Japan .MIAPJ0000PUS rose 0.5%, following on

from gains on Wall Street. S&P e-mini futures ESc1 added 0.2%.

Australian shares .AXJO climbed 0.8%, while Japan's Nikkei

stock index .N225 gained 0.9%.

The more bullish market mood came after a first day of trade

talks between top U.S. and Chinese negotiators that Trump

characterised as "very, very good."

A White House official said the talks had gone "probably

better than expected" and a U.S. Chamber of Commerce official

briefed by both sides raised the possibility of a currency

agreement this week. "Freezing tariffs at current levels are unlikely to reverse

the current trade driven slowdown in economic growth, and the

uncertainty around unresolved structural issues such as IP theft

and subsidies to state own enterprises are likely to remain

deterrents for a pick-up in much needed capital expenditure,"

analysts at National Australia Bank said in a morning note.

"On this score details on a potential currency pact will be

important," they said.

The dollar rose 0.1% against the yen to 108.07 JPY= , while

the euro was flat at $1.1004 and the pound was slightly lower,

fetching $1.2432.

The dollar index .DXY , which tracks the greenback against

a basket of six major rivals, was down at 98.663 after posting

its biggest daily drop in five weeks on waning safe-haven demand

for the currency.

The British pound jumped nearly 2% on Thursday, its biggest

daily gain since March, after Irish Prime Minister Leo Varadkar

said a Brexit deal could be clinched by the end of October after

what he called a very positive meeting with his British

counterpart, Boris Johnson. The move away from safe havens also lifted the yield on

benchmark 10-year Treasury notes US10YT=RR to 1.6716% compared

with a U.S. close of 1.656% on Thursday. Yields rose across the

curve, with two-year notes US2YT=RR yielding 1.5464% compared

with a U.S. close of 1.53%.

In commodity markets, oil prices remained higher after the

head of OPEC said the organisation could take action to balance

oil markets, including a deeper cut in oil supplies.

U.S. crude CLc1 was up 0.43% to $53.78 a barrel and global

benchmark Brent crude LCOc1 was up 0.46% at $59.37 per barrel.

Rising risk appetite tarnished gold's appeal, pushing spot

gold XAU= down 0.16% to $1,491.65 per ounce. GOL/

(Editing by Jacqueline Wong)

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