Asian markets initially opened lower, spooked by reported comments by White House trade adviser Peter Navarro suggesting the U.S. trade deal with China was in trouble. However, Navarro said his comments were taken out of context, and President Donald Trump tweeted that the agreement with China, the basis for a truce in a tariff war over technology and other problems, is still on. Trump tweeted: “The China Trade Deal is fully intact. Hopefully they will continue to live up to the terms of the Agreement!”
Comments by either side suggesting progress or problems with the trade agreement have added to the uncertainties prevailing in the midst of the pandemic, pushing and pulling at share prices. After some early losses, markets pressed higher.
Japan's benchmark Nikkei 225 added 0.5% to finish at 22,549.05. Hong Kong's Hang Seng index jumped 1.6% to 24,907.34 and South Korea's Kospi climbed 0.2% to 2,131.24. Australia's S&P/ASX 200 edged up 0.2% to 5,954.40, while the Shanghai Composite gained 0.2 to 2,970.62.
Shares rose in Singapore and Taiwan but fell in Jakarta. “It’s back to the regular order of business, which is trying to figure out why stocks are so high!" Stephen Innes of AxiCorp said in a commentary. “You can add the resurgence of COVID-19 to the laundry list of things the market doesn’t care about, so it seems.”
Investors are favoring retailers and other companies that are poised to do well now that more businesses have been given the go-ahead to reopen. But traders are also continuing to hedge their bets by snapping up traditionally less risky assets, such as government bonds and gold, which also rose.
On Tuesday, the Commerce Department will serve up new home sales figures for May. Further updates on the U.S. economy are expected toward the end of this week, when the government will issue data on consumer spending, weekly unemployment aid applications and durable goods orders.
Benchmark U.S. crude oil added 38 cents to $41.11 a barrel. Brent crude, the international standard, rose 39 cents to $43.47 per barrel. The dollar rose to 107.17 Japanese yen from 106.90 yen late Monday. The euro was trading at $1.1268, up from $1.1262.