By Alex Ho
Investing.com - Asian stock markets traded mostly higher on Thursday in Asia as investors cheered the signing of the phase one U.S.-China trade deal.
China’s Shenzhen Composite rose 0.2%, while the Shanghai Composite slipped 0.1%. Hong Kong’s Hang Seng Index climbed 0.4%.
Overnight, officials from the U.S. and China signed the phase one trade agreement, putting their two-year trade conflict on a pause.
“This is a very important and remarkable occasion,” U.S. President Donald Trump said during the signing ceremony at the White House. Fixing what he sees as the injustices of past trade deals is “probably the biggest reason why I ran for president,” he added. “Together we are righting the wrongs of the past.”
Under the terms of the deal, the U.S. slashes tariffs on $120 billion in Chinese goods to 7.5% from 15%. In exchange, China agreed to increase purchases in the U.S. by $200 billion over the next two years in manufactured goods, agriculture, energy and services.
However, gains were limited as some analysts called the deal “fragile” as it includes an option for China to exit the trade deal should the U.S. re-impose tariffs.
“There will be continued tension over China—over cyber, over national security, over human rights. Those issues aren’t going to go away, but those issues don’t really matter to the earnings of the S&P 500 companies the way an escalation of tariffs would,” said Daniel Clifton, head of policy research at Strategas, in a CNBC report.
On the data front, while not a directional driver, the National Bureau of Statistics reported today that China’s new home prices rose 0.3% in December month-on-month.
Japan’s Nikkei 225 inched up 0.1%. South Korea’s KOSPI advanced 0.2%.
Down under, Australia’s S&P/ASX 200 traded 0.6% higher.