Stocks in Asia Pacific traded higher Wednesday morning as the U.S. announced a delay in the implementation of tariffs on some Chinese goods.
Overall, the MSCI Asia ex-Japan index added 0.59%.
The United States Trade Representative announced Tuesday certain products including clothing and cellphones are being removed from the tariff list based on “health, safety, national security and other factors” and will not face additional tariffs of 10%. Other tariffs will be delayed to Dec. 15 from Sep. 1 for certain goods, it said.
“A cynical view then is that the delay is purely for political timing rather than a more substantive change in the US’ approach to the US-China relationship,” Tapas Strickland, an economist at National Australia Bank, wrote in a note.
“Overall a high degree of (skepticism) should remain and an imminent deal is unlikely given Trump has foreshadowed he is going to be campaigning hard on the issue in the 2020 election,” Strickland said.
Investors will be watching for the reaction from the People’s Bank of China when it announces its official midpoint reference rate for the yuan around 9:15 a.m. HK/SIN. It had last fixed the midpoint at 7.0326 per dollar on Tuesday — stronger than analysts’ expectations — and the fourth consecutive session where the central bank set the figure weaker than the psychologically important 7-yuan-per-dollar level.
Meanwhile, tensions in Hong Kong remained high after the city’s airport saw disruptions for a second day on Tuesday as a result of protests.
Chinese industrial production data is also set to be released at 10:00 a.m. HK/SIN today, as investors watch for the economic impact of the ongoing trade war between Beijing and Washington.
Asia-Pacific Market Indexes Chart
Shares of Apple suppliers in Asia will be also be under scrutiny today, with the Cupertino-based tech giant seeing its stock surge more than 4% on Tuesday.
Overnight stateside, the Dow Jones Industrial Average finished the day 372.54 points higher at 26,279.91, while the S&P 500 added 1.48% to close at 2,926.32. The Nasdaq Composite ended its trading day 1.95% higher at 8,016.36.
Dollar holds on to gains
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 97.784 after surging from levels below 97.5 yesterday.
The Japanese yen, often seen as a safe-haven currency, traded at 106.52 against the dollar after weakening sharply from levels below 105.5 in the previous session. The Australian dollar changed hands at $0.6795 after jumping from levels below $0.676 yesterday.
Here’s a look at some of the data due today:
- Australian wage data at 9:30 a.m. HK/SIN
- China: Industrial production, fixed asset investment (year to date), retail sales data for July at 10:00 a.m. HK/SIN
- Hong Kong earnings: HKEX, Champion REIT, Lenovo, Tencent
— CNBC’s Yun Li contributed to this report.