Asian shares extend gains on hopes for trade breakthrough

Elaine Kurtenbach, The Associated Press</span>
Published Tuesday, January 8, 2019 11:51PM EST

BANGKOK -- Shares extended gains in Asia on hopes for progress in resolving the tariffs battle between the U.S. and China as talks appeared to have been extended in Beijing.

KEEPING SCORE: Japan's Nikkei 225 index gained 1.3 per cent to 20,472.79 and Hong Kong's Hang Seng jumped 2.5 per cent to 26,512.06. The Shanghai Composite index surged 1.6 per cent to 2,566.66 while South Korea's Kospi advanced 1.9 per cent to 2,062.64. Australia's S&P ASX 200 surged 0.9 per cent to 5,775.20. Shares also rose in Taiwan and Southeast Asia.

CHINA-U.S. TRADE: President Donald Trump tweeted that "Talks with China are going very well!" as news reports said trade negotiations would be extended to a third day, a potential positive sign even though no major developments have been announced so far. Experts say it may take months to resolve the causes of the trade war, which include disagreements over Beijing's handling of technology and intellectual property.

U.S. SHUTDOWN: President Donald Trump's televised address Tuesday night helped soothe frazzled nerves over what steps he might take in the standoff with lawmakers over border wall funding, which has resulted in a partial government shutdown. Trump argued for funding on security and humanitarian grounds as he sought to put pressure on newly empowered Democrats.

ANALYST'S VIEWPOINT: "Trump did not declare a national emergency, nor did he hint toward one, which might have been a fear before the speech," Stephen Innes of Oanda said in a commentary. Meanwhile, "currencies are holding firm riding the wave sentiment from the positive buzz in U.S.-China trade talks."

WALL STREET: Optimism over trade propelled shares to their third straight session of gains Tuesday, the longest winning streak for U.S. indexes since late November. The S&P 500 index rose 1 per cent to 2,574.41. The Dow Jones Industrial Average picked up 1.1 per cent to 23,787.45 and the Nasdaq composite also gained 1.1 per cent, to 6,897. The Russell 2000 index of smaller-company stocks gained 1.5 per cent, to 1,426.55.

ENERGY: Oil prices also continued to rally. U.S. crude rose 80 cents to $50.58 per barrel in electronic trading on the New York Mercantile Exchange. It has risen for eight of the past nine days and gained 2.6 per cent to $49.78 per barrel on Tuesday. Brent crude, used to price international oils, added 79 cents to $59.51 per barrel. It gained 2.4 per cent to $58.72 a barrel in London.

CURRENCIES: The dollar climbed to 108.91 yen from 108.75 yen. The euro rose $1.1454 from $1.1442.

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AP Markets Writer Marley Jay contributed.

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