Asia tries to see light in trade talks, Brexit votes

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© Reuters. An investor sits in front of an electronic board showing stock information at a brokerage house in Beijing© Reuters. An investor sits in front of an electronic board showing stock information at a brokerage house in Beijing

By Wayne Cole

SYDNEY (Reuters) – Asian share markets edged ahead on Tuesday amid cheery chatter about the chance of a Sino-U.S. trade deal, while investors were sanguine yet another vote on Brexit would still avert a hard exit.

A holiday in Tokyo kept turnover light and MSCI’s broadest index of Asia-Pacific shares outside Japan added a slight 0.13%.

Futures for Japan’s Nikkei () were trading flat at 22,700, compared to Monday’s index close at 22,548 (). South Korean stocks () rose 0.4%, while E-Mini futures for the S&P 500 () were little changed.

U.S. President Donald Trump sounded upbeat on a China deal on Monday, while White House adviser Larry Kudlow said tariffs on Chinese goods scheduled for December could be withdrawn if talks go well.

Trade-sensitive technology stocks () rose 1.1%, pulling the S&P 500 () up 0.69% and near to a record closing high. The Dow () gained 0.21%, while the Nasdaq () rose 0.91%.

The better mood saw safe-haven bonds extend their recent pullback, with 10-year Treasury yields at a five-week peak of 1.80%.

In foreign exchange markets, the dollar found support against the yen at 108.60 while staying steady on a basket of currencies to 97.307 ().

The euro paused after its recent run higher and was last trading quietly at $1.1151 ().

Sterling held firm at $1.2972 after Prime Minister Boris Johnson failed to get a vote on his Brexit deal and will try again on Tuesday to get the first stage of a withdrawal bill through Parliament.

“If the House of Commons vote in favour of the deal, could rally towards $1.3500 over the medium term.  The UK would then enter a transition period that lasts until 31 December 2020,” said Kim Mundy, a currency strategist at CBA.

“If the Commons rejects the deal, GBP/USD will likely stabilise around $1.2800, because the risk of a hard Brexit will remain low,” he added. “Early UK general elections would be the next most logical way forward.”

In commodity markets, was idling at $1,483.70 per ounce .

Oil prices were near flat as the market fretted about the health of the global economy and the future for energy demand.

futures inched up 7 cents to $59.03, while added 9 cents to $53.40 a barrel.

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