Asia Advances on Trade Optimism

Stocks in Asia were mostly higher on Tuesday, as U.S.-Japan trade talks kicked off and the Bank of Japan chief flagged risks of increasing trade protectionism to the global economic growth outlook.

The Nikkei 225 gained 52.55 points, or 0.2%, 22,221.66, with shares of index heavyweights Fast Retailing jumping 2.3% and Softbank Group rising 1.3%.

The Japanese yen, considered a safe-haven currency, traded at 111.91 to the U.S. dollar, strengthening from an earlier level around 112.09

In Hong Kong, the Hang Seng Index vaulted 319.15 points, or 1.1%, to 30,129.87

Shares of Japanese telcos Softbank Corp added 3.1%, and NTT Docomo rose 3.6% after the latter announced price cuts that were smaller than expected.

Bank of Japan Governor Haruhiko Kuroda said “some sort of protectionism” around global trade was the “most serious risk involved in the global economy,” in an interview that aired on Monday.

Kuroda’s comments come as the U.S and Japan kicked off trade talks in Washington on Monday. U.S. President Donald Trump has made it clear he is unhappy with Japan’s $69-billion trade surplus with the United States and wants a two-way agreement to address it.

Japanese Economy Minister Toshimitsu Motegi told reporters that he had a “frank and good exchange ” with U.S. Trade Representative Robert Lighthizer, with the two set to meet again on Tuesday

The Japanese yen traded at 111.86 U.S. touching an earlier low of 112.05.

In Korea, markets surged as shares of Asiana Airlines surged 16.1%

The top shareholder of Asiana Airlines, Kumho Industrial, said on Monday it would sell its entire stake in the debt-ridden carrier to keep it afloat. That followed weeks of financial uncertainty after the carrier failed to win auditors’ signoff on its 2018 financial statements, which triggered warnings of credit ratings downgrades. For its part, Kumho Industrial saw its stock jump 6.6%.

The Australian dollar changed hands at $0.7148 U.S. after touching an earlier high of $0.7175. The moves came following the release of minutes from the Reserve Bank of Australia’s April monetary policy meeting.

CHINA

The CSI 300 in China recovered 110.27 points, or 2.8%, to 4,085.79

Resilience in the property market would provide some cushion for China’s economy as sectors such as manufacturing and retail are hit by trade war tensions and weak consumer confidence.

Average new home prices in China rose faster in March as compared to February, according to Reuters’ calculation of data released by the National Bureau of Statistics on Tuesday.

Meanwhile, China and the U.S. appear to be close to striking a trade deal.

The Chinese made unprecedented proposals on forced technology transfers, a sticking point in the negotiations, Reuters reported earlier. U.S. Treasury Secretary Steven Mnuchin said Sunday that the U.S. is open to facing penalties if it doesn’t comply with an agreed-upon trade deal. However, Mnuchin also said Monday the two sides still have lots of work ahead of them.

In other markets

In Singapore, the Straits Times Index recaptured 6.18 points, or 0.2%, to 3,332.04

Korea’s Kospi Index inched up 5.75 points, or 0.3%, to 2,248.63

The Taiex Index in Taiwan added 52.25 points, or 0.5%, to 10,927.85

In New Zealand, the NZX 50 strengthened 62.04 points, or 0.6%, to 9,908.39

In Australia, the ASX 200 powered up 26.01 points, or 0.4%, to 6,277.45