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Asia Markets Roundup: markets mixed as rally is stunted by profit-taking

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April 4, 2019:   Asian markets were mixed Thursday as growing expectations that China and the United States will reach a trade agreement were offset by profit-taking after an extended rally.

Hopes Britain will avert crashing out of the EU next week also instilled some optimism on trading floors, with the pound extending gains.

High-level talks between the world's top two economies resumed Wednesday in Washington, with reports saying they are edging towards an agreement to bring the curtain down on a long-running row that helped batter markets last year.

Bloomberg News said the deal they are working on would give China until 2025 to meet pledges on purchases and to let US firms wholly own their businesses in the country.

It said the aim was to get everything in place for presidents Donald Trump and Xi Jinping to sign off on a trade deal.

White House economic adviser Larry Kudlow the talks were “making good headway” but added: “We're not there and we hope this week to get closer.”

The Bloomberg report follows an article in the Financial Times saying they were closing in on an agreement.

“The market is becoming more convinced that a deal is coming between China and the US,” Greg McKenna, at McKenna Macro, said in a note. “Enforcement on the US side and lifting tariffs to cement the deal on the Chinese side seem now to be the points of contention.”

David Madden, a market analyst at CMC Markets UK, pointed out that Kudlow had flagged movement on intellectual property theft and hacking, which are key bugbears of the White House.

“These issues have been a major point of contention for the US, and the fact that they are being discussed, indicates that Beijing are serious about reaching a deal,” he added.

(APP)

Posted on: 2019-04-04T15:54:00+05:00

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