Asian shares climb, dollar eases ahead of US-China talks
TOKYO -Shares jumped and the dollar pared recent gains on Monday as Asian markets reacted to better-than-expected U.S. jobs data ahead of talks in London aimed at mending a trade rift between the United States and China.
Wall Street stocks had closed sharply higher on Friday after the jobs data eased concerns about damage to the world's biggest economy from President Donald Trump's unpredictable tariff regime.
On Monday, MSCI's broadest index of Asia-Pacific shares outside Japan climbed 0.7%, with Australia's markets shut for a holiday. Japan's Nikkei stock index rose 0.9%.
But pan-region Euro Stoxx 50 futures pointed to a decline while U.S. stock futures, the S&P 500 e-minis, slid 0.2%.
Sentiment was weighed down by a standoff in Los Angeles that led to Trump calling in the California National Guard to quell demonstrations over his immigration policies.
The dollar slid 0.3% against the yen to 144.46, trimming its 0.9% jump on Friday. The European single currency was up 0.2% on the day at $1.1417. Sterling traded at $1.3553, up 0.3%.
Top trade representatives from Washington and Beijing are due to meet for talks expected to focus on critical minerals, whose production is dominated by China. The discussions follow a rare call last week between Trump and Chinese President Xi Jinping.
"Trade policy will remain the big macro uncertainty," said Kyle Rodda, a senior financial market analyst at Capital.com. "Signs of further momentum in talks could give the markets fresh boost to kick-off the week."
U.S. Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer will represent Washington in talks with China, Trump said in a social media post. China's foreign ministry said Vice Premier He Lifeng will be in Britain for the first meeting of the China-U.S. economic and trade consultation mechanism.
CHINA EXPORT GROWTH SLOWS
U.S. job growth slowed in May by less than had been forecast, data showed on Friday. But dour economic readings from China added to evidence the trade war is taking a toll.
China's export growth slowed to a three-month low in May, while factory-gate deflation deepened to its worst level in two years, separate reports showed on Monday.
Even so, trade optimism lifted Chinese shares. Hong Kong's Hang Seng Index rose 0.8%, touching the 24,000-point level for the first time since March 21. China's blue-chip CSI300 Index added 0.2%.
Attention now turns to U.S. inflation data on Wednesday that will feed into expectations for the timing of any rate cuts by the Federal Reserve. The Fed is in a blackout period ahead of its June 18 policy decision.
Markets are facing "mixed fortunes" on Monday as they balance optimism over trade and the U.S. economy against the potential for social unrest in California, said Jeff Ng, Head of Asia Macro Strategy at SMBC.
"The trade talks, if there's any progress, may help as well, but markets may not have priced in a lot of breakthrough for that," Ng said. "In the meantime, we are also quite cognizant that in the U.S. there are protests in L.A. and the National Guard is also being sent in, so we have to be on the watch for event risk as well."
Gold was little changed at $3,311.65 per ounce after a 1.3% slide on Friday. U.S. crude was steady at $64.54 a barrel following a 1.9% surge late last week.
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