Stocks jump in Japan, Taiwan on trade optimism; bitcoin soars
TOKYO, May 9 (Reuters) – Stocks surged in Japan and Taiwan on Friday after a U.S. trade deal with Britain fuelled guarded optimism for progress in tariff talks with other countries.
Bitcoin soared to the highest since January and U.S. crude ticked up after a more than 3% surge on Thursday, when President Donald Trump announced the agreement with British Prime Minister Keir Starmer – the first in the month since Trump started a 90-day pause on trade tariffs to allow room for negotiations.
At the same time, concerns that the limited trade agreement with London may not provide much of a blueprint for additional deals cooled hopes around the outcome of Sino-U.S. trade talks set for Saturday in Switzerland.
Mainland blue chips (.CSI300), opens new tab eased 0.1%, while Hong Kong’s Hang Seng (.HSI), opens new tab rose 0.3% after struggling for direction during the session.
Japan’s Nikkei (.N225), opens new tab soared 1.7% and Taiwan’s equity benchmark (.TWII), opens new tab advanced 1.8%, with technology shares the strongest performing sector.
Australian stocks (.AXJO), opens new tab rose 0.5% and Singapore’s Straits Times Index (.STI), opens new tab added 0.8%.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab gained 0.4%.
“The deal between the U.S. and UK was more style over substance,” said Kyle Rodda, a senior financial markets analyst at Capital.com.
“However, it feeds the narrative that the U.S. is looking to bang out rapid-fire trade deals and reduce tariffs – at the margins – and other trade barriers,” Rodda said.
“Constructive language and statements of intent will likely be enough to drive stocks higher off the back of the U.S.-China trade talks.”
Trump pushed back against seeing the UK deal as a template for other negotiations.
The “general terms” agreement leaves in place a 10% tariff on goods imported from the UK but lowers prohibitive U.S. duties on UK car exports. Britain agreed to lower its tariffs to 1.8% from 5.1% and provide greater access to U.S. goods.
Last week, Trump said he has “potential” trade deals with India, South Korea and Japan.
NYMEX U.S. crude ticked up 0.3% to $60.25 per barrel on Friday, building on the previous day’s 3.2% surge. Brent crude added 0.3% to $63.18 per barrel, following Thursday’s 2.8% rally.
The U.S. dollar index , which measures the currency against six major peers, edged to a one-month peak at 100.86.
The euro sagged to a one-month trough at $1.1197, and sterling slipped to a three-week low of $1.3213.
The yen dipped to a one-month low of 146.185 per dollar, after a 1.5% tumble on Thursday.
Higher U.S. Treasury yields helped support the greenback, with the 10-year yield steady at 4.3667% following Thursday’s 10-basis point jump as demand for the safety of bonds ebbed.
Bitcoin was also buoyed by the improvement in market sentiment, rising to the highest since January 31 at $103,909.17, and closing the distance with the all-time high from January 20 at $109,071.86.
Standard Chartered’s Geoffrey Kendrick no longer sees risk sentiment as the main driver for the world’s biggest cryptocurrency.
“It is now all about flows, and flows are coming in many forms,” said Kendrick, the bank’s global head of digital assets research, pointing to an influx of cash into bitcoin ETFs, as well as buying by so-called whales.
“I think a fresh all-time high for bitcoin is coming soon,” he said. “I apologise that my $120,000 Q2 target may be too low.”