Most emerging Asian equities rose on Monday ahead of the crucial trade talks between the U.S. and China in London later in the day, while regional currencies remained subdued against a steady dollar.
Top trade representatives from Washington and Beijing will meet for talks aimed at defusing the high-stakes trade disputes between the world’s two largest economies, which have flared up in recent weeks.
The second round of meetings comes four days after U.S. President Donald Trump and Chinese leader Xi Jinping spoke by phone, their first direct interaction since Trump’s January 20 inauguration.
“The U.S. and China will be holding formal talks around hashing out their differences and trying to reach a trade deal has provided some positive sentiment to markets in the region”, said Khoon Goh, head of Asia research at ANZ.
MSCI’s gauge of Asian emerging market equities rose as much as 1% to its highest level since October 2024.
Taiwan stocks rose 0.7% and Singapore shares added 0.2%. Chinese stocks gained 0.3%.
South Korean shares climbed 1.7%, supported by post-election policy optimism under newly elected President Lee Jae-myung. The benchmark index had gained 4% last week.
A positive session on Wall Street on Friday, driven by better-than-expected U.S. jobs data, helped ease concerns over a potential U.S. recession and is lifting investor confidence today, Goh added.
Data showed that nonfarm payrolls increased by 139,000 jobs last month fewer, than the 147,000 jobs added in April but exceeding the 130,000 gain forecast in a Reuters poll of economists.
Regional currencies were largely flat, with the Singapore dollar rising 0.2% and the Malaysian ringgit falling 0.2%.
The dollar slipped 0.1%, retracing part of the 0.5% gain it posted on Friday, as initial enthusiasm over a strong U.S. employment report gave way to caution ahead of key U.S.-China trade talks.
Analysts at Nomura expect markets to remain choppy and range-bound through summer amid ongoing tariff uncertainties. “Market attention remains fixated on the expiration of the 90-day pause on tariffs (subject to court rulings)”. Markets in Indonesia were closed for a public holiday.
HIGHLIGHTS:
** South Korea president calls for measures to respond to rising prices
** BOJ must ensure fiscal considerations don’t overtake mandate, deputy governor says – Reuters