Asian markets extend gains as China-US talks head into second day
10 June 2025 08:33
Hong Kong (AFP) Asian stocks squeezed out more gains Tuesday as the latest round of China-US trade talks moved into a second day, with one of Donald Trump's top advisers saying he expected "a big, strong handshake".There is optimism the negotiations -- which come after the US president spoke to Chinese counterpart Xi Jinping last week -- will bring some much-needed calm to markets and ease tensions between the economic superpowers.The advances in Asian equities built on Monday's rally and followed a broadly positive day on Wall Street, where the S&P 500 edged closer to the record high touched earlier in the year.This week's meeting in London will look to smooth relations.The key issues on the agenda at the talks are expected to be exports of rare earth minerals used in a wide range of things including smartphones and electric vehicle batteries."In Geneva, we had agreed to lower tariffs on them, and they had agreed to release the magnets and rare earths that we need throughout the economy," Trump's top economic adviser, Kevin Hassett, told CNBC on Monday.But even though Beijing was releasing some supplies, "it was going a lot slower than some companies believed was optimal", he added.Still, he said he expected "a big, strong handshake" at the end of the talks."Our expectation is that after the handshake, any export controls from the US will be eased, and the rare earths will be released in volume," Hassett added.He also said the Trump administration might be willing to ease some recent curbs on tech exports.The president told reporters at the White House: "We are doing well with China. China's not easy."I'm only getting good reports."Tokyo led gains in Asian markets, with Hong Kong, Shanghai, Sydney, Seoul, Singapore, Taipei, Wellington and Jakarta also well up."The bulls will layer into risk on any rhetoric that publicly keeps the two sides at the table," said Pepperstone's Chris Weston."And with the meeting spilling over to a second day, the idea of some sort of loose agreement is enough to underpin the grind higher in US equity and risk exposures more broadly."Investors are also awaiting key US inflation data this week, which could impact the Federal Reserve's monetary policy amid warnings Trump's tariffs will refuel inflation strengthening the argument to keep interest rates on hold.However, it also faces pressure from the president to cut rates, with bank officials due to make a decision at their meeting next week.
While recent jobs data has eased concerns about the US economy, analysts remain cautious.
Stock Markets
Continue full coverage
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Arabian Post
2 hours ago
- Arabian Post
Ethiopia Targets 8.9 % Growth as Budget Widens
Ethiopia's finance minister has announced that the economy is projected to expand by 8.9 % in the fiscal year beginning 8 July 2025, alongside a modest increase in the budget deficit amid structural reforms. Finance Minister Ahmed Shide addressed parliament on Tuesday, outlining the forecast for the next fiscal year, citing an acceleration in real GDP growth from an estimated 8.4 % this year to 8.9 % next year. The state budget deficit is expected to rise slightly to 2.2 % of GDP, compared to 2.1 % in the current year. Total government expenditure is projected at 1.9 trillion birr, equivalent to around US $14 billion. This positive outlook is deeply anchored in ongoing reforms backed by an International Monetary Fund programme. These include the liberalisation of the exchange rate, debt restructuring negotiations, and the establishment of the Ethiopian Securities Exchange, which opened in January after a 50‑year absence. ADVERTISEMENT The cabinet's approval of the new budget earlier this month signalled a strategic reallocation of resources, with spending set to increase by 31 % compared to the previous year's 971 billion birr. A significant portion is earmarked for national security, productivity enhancement, and disaster relief, including continued subsidies for fuel, fertiliser, oil and medicines—a move aimed at dampening inflationary pressure on households. Reforms and their impacts The IMF programme that began in July 2024 has been a linchpin in the reform agenda. In April, State Finance Minister Eyob Tekalign reported that the third review of the four‑year US $3.4 billion loan arrangement had reached staff‑level agreement, with approval by the IMF executive board anticipated this month. Subsequent draws will hinge on continued reform progress, notably debt restructuring. Debt, inflation and exchange rate liberalisation remain pressing concerns. A draft budget revealed that 463 billion birr—nearly 39 % of recurrent expenditure—will go towards debt servicing, surpassing planned capital outlays. The government intends to restructure approximately US $3.5 billion in external liabilities through agreements in upcoming weeks. Bondholder writedowns are expected as part of a broader debt resolution strategy. Monetary reforms have lessened inflation, which reached 29.2 % in 2022/23, and narrowed the spread between official and parallel exchange rates. Foreign reserves have rebounded, tripling to US $3.6 billion, easing foreign exchange shortages. These financial indicators have been central in IMF assessments. Policy makers are awaiting formal debt restructuring talks this summer with official and private creditors alike, guided by the G20 Common Framework. Iran‑timed agreements with Chinese policy banks, the U.S. International Development Finance Corporation and other funders are being explored to support infrastructure and development needs. Regional comparisons and strategic outlook Ethiopia remains one of sub‑Saharan Africa's highest growth economies, although still below the pre‑covid annual average of around 10 %. The country's trajectory continues to be shaped by recovery from the Tigray war, covid‑19 disruptions, droughts and locust invasions, but ongoing reforms are expected to unlock further expansion. The imminent fiscal year budget, combining a steep rise in expenditure with a stabilising deficit, underscores a cautious but ambitious strategy: focusing on debt management, reform momentum and public service delivery, rather than unfettered spending. Key stakeholders, including opposition figures such as Desalegn Chane of the National Movement of Amhara, have voiced concern over rising tax burdens amid steady living costs and a depreciating birr. Criticism has targeted new levies on motor vehicles and excise taxes, with claims these conflict with subsidy policies. The finance minister, however, defended these as necessary for fiscal resilience and revenue expansion. Broader reform dynamics have been influenced by Prime Minister Abiy Ahmed's economic agenda, including the launch of Ethiopia's first stock market since the Haile Selassie era, currency liberalisation, and opening the banking sector to foreign investment. These steps have been deemed essential to securing up to US $27 billion in external funding from IMF, World Bank, UAE, China and others over the next four years. Looking ahead The projection of roughly 8.9 % GDP growth signals confidence that reforms are gaining traction, even as the government prepares to finance a wider budget and service rising debt. The success of the IMF programme's next review, debt restructuring outcomes, and reform implementation will determine whether Ethiopia can sustain its economic momentum and weather domestic and global headwinds.
Middle East Eye
2 hours ago
- Middle East Eye
US Secretary of State Rubio terminates all USAID positions abroad: Report
By the end of September, there will be no such thing as the United States Agency for International Development (USAID), The Guardian reported on Monday, because all of its overseas staff will be terminated. Many, if not most, are local hires who have depended on a USAID salary for years and sometimes decades to support their families. The Guardian attributed the revelation to a State Department cable that it had obtained. It said the chiefs of mission at embassies in more than 100 countries have been notified that a significant overhaul is coming. 'The Department of State is streamlining procedures under National Security Decision Directive 38 to abolish all USAID overseas positions,' the cable said. The State Department and Secretary of State Marco Rubio 'will assume responsibility for foreign assistance programming previously undertaken by USAID' from 15 June, it added. New MEE newsletter: Jerusalem Dispatch Sign up to get the latest insights and analysis on Israel-Palestine, alongside Turkey Unpacked and other MEE newsletters In early March, Rubio said that US President Donald Trump's purge of the six-decade-old USAID was complete and that 5,200 of its 6,200 programmes had been eliminated. The remaining programmes, he said, would now be administered 'more effectively' under the State Department and in consultation with Congress. The axing of the aid agency was an initiative from the Elon Musk-led Department of Government Efficiency, which aimed to save Washington billions in what it believed was unnecessary spending. Among its earliest finds was what the administration described as $50worth of condoms sent by the US "to Hamas". It was then revealed that it was a programme to prevent sexually transmitted diseases in the rural province of Gaza, Mozambique. Musk departed the administration two weeks ago. Since the Trump administration announced an immediate suspension of all foreign assistance, blocking ongoing aid programmes and freezing new funding, humanitarian workers around the world have been trying to work out exactly what this means for the millions of vulnerable people they are trying to keep alive. Middle East Eye reported on the impact of the initial USAID cuts on 1.8 million Sudanese experiencing famine. Food boxes sent by the US were rotting in warehouses because the agency no longer provided the money needed for the actual distribution. Since 1946, the Middle East and North Africa have been the biggest recipients of US financial assistance. Between April 2023 and April 2024, Congress appropriated around $9bn for the region. While most of the aid went towards military assistance, a fraction was funnelled into democracy programmes via USAID and the National Endowment for Democracy, a quasi-autonomous agency funded largely by the US Congress. MEE reported in May of this year that the Trump cuts to USAID have already impacted human rights defenders in the region who were reliant on the small grants to relocate and resettle abroad. Although modest in scope, the money provided a lifeline for exiled human rights activists.
The National
3 hours ago
- The National
Sheikh Abdullah bin Zayed welcomed to US State Department by Marco Rubio
US Secretary of State Marco Rubio met Sheikh Abdullah bin Zayed, UAE Deputy Prime Minister and Minister of Foreign Affairs, at the State Department on Tuesday. Sheikh Abdullah was greeted by Mr Rubio in Washington a day after Deputy Secretary of State Christopher Landau welcomed UAE Assistant Foreign Minister Lana Nusseibeh to the State Department. US President Donald Trump visited the UAE, Saudi Arabia and Qatar last month for a major trip that saw major business and investment announcements and the US lifting sanctions on Syria. Mr Rubio and Sheikh Abdullah appeared briefly in front of cameras but did not take any questions. Mr Rubio later said that he and Sheikh Abdullah worked to sustain momentum from Mr Trump's "historic visit" to Abu Dhabi. "We discussed economic opportunities, regional security, and humanitarian efforts to mark the growing partnership between the United States and the UAE," Mr Rubio said on X. Mr Landau said in a statement that during Monday's meeting with Ms Nusseibeh, the two discussed security, stability and prosperity in the Middle East as well as a path to ending the conflict in Sudan.
