Shares in Asia were set to trade higher on Tuesday as investors monitor for further developments on the U.S.-China trade front with the two economic powerhouses working toward a deal.
Futures pointed to a higher open for Japanese stocks, with the Nikkei futures contract in Chicago at 22,970 and its counterpart in Osaka at 22,960. The Nikkei 225 last closed at 22,867.27.
Meanwhile, shares in Australia rose more than 0.2% in early trade, with majority of the sectors edging higher.
Investors will continue to watch for developments in U.S.-China trade. The Office of the U.S. Trade Representative said Monday that Washington will consider extending certain tariff exclusions on $34 billion worth of imports from China. The USTR said last week that China and the U.S. are close to finalizing a phase one deal.
For his part, U.S. President Donald Trump said the deal with China is expected to be signed “ahead of schedule,” but did not elaborate on the timing.
“The two sides have seemingly reached consensus in areas including standards used by agricultural regulators, but is probably worth noting that so far neither party has officially said anything about the contentious issue surrounding China’s demand for a pullback on US Tariffs,” Rodrigo Catril, senior foreign exchange strategist at National Australia Bank, wrote in a morning note.
Overnight on Wall Street, the S&P 500 scaled a record high as investors stateside cheered strong earnings and optimism on U.S.-China trade. The S&P 500 added 0.6% to close at 3,039.42 — above its previous record set on July 26. The Dow Jones Industrial Average rose 132.66 points to end its trading day at 27,090.72 while the Nasdaq Composite gained 1% to close at 8,325.99.
Of the 206 S&P 500 companies that reported through Monday morning, 78% have topped analyst expectations, according to FactSet.
Currencies
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 97.764 after touching highs above 97.8 yesterday.
The Japanese yen traded at 108.96 against the dollar after weakening from levels below 108.9 in the previous session. The Australian dollar changed hands at $0.6836 after touching highs above $0.684 yesterday.
What’s on tap:
- Japan earnings: NTT Docomo, Nomura Holdings, NEC, ANA
- Australia: Reserve Bank of Australia Governor Philip Lowe speech at 2:45 p.m. HK/SIN
— CNBC’s Lauren Hirsch and Fred Imbert, along with Reuters, contributed to this report.
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