Asian Markets Mostly Higher As Trade War Fears Ease

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Asian stock markets are mostly higher on Monday after U.S. Treasury Secretary Steven Mnuchin said that the U.S. trade war with China is "on hold" as the world's two largest economies work on a wider trade agreement. On Saturday, Chinese and American negotiators reached an agreement to set up a framework for addressing trade imbalances in the future.

The Australian market is edging higher after a weak start. Gains by oil stocks helped offset weakness in banks and mining stocks.

In late-morning trades, the S&P/ASX 200 Index is adding 3.00 points or 0.05 percent to 6,090.40, after touching a low of 6,070.30 earlier. The broader All Ordinaries Index is up 4.40 points or 0.07 percent to 6,195.30.

Oil stocks are higher despite crude oil prices edging lower on Friday. Woodside Petroleum is adding 0.3 percent and Oil Search is advancing 0.6 percent. Santos is rising more than 2 percent after U.S. private equity firm Harbour Energy raised its takeover bid for the company to about $10.9 billion.

The big four banks are mostly lower as the royal commission into banking practices is due to kick off this week. Westpac, Commonwealth Bank and National Australia Bank are down in a range of 0.6 percent to 0.9 percent, while ANZ Banking is edging up less than 0.1 percent.

In the mining sector, BHP Billiton is down 0.2 percent, Rio Tinto is declining 0.6 percent and Fortescue Metals is losing almost 2 percent after a fall in iron ore prices and some base metals.

Gold miners are mixed. Evolution Mining is losing 0.2 percent, while Newcrest Mining is advancing more than 1 percent after gold prices edged higher.

AGL Energy has rejected Alinta Energy's A$250 million offer to buy Liddel Power Station and reiterated its decision to close the plant in 2022. Shares of AGL Energy are rising more than 1 percent.

Shares of Vocus Group are gaining almost 4 percent after the company named former Optus boss Kevin Russell as managing director and chief executive, three months after Geoff Horth resigned.

In the currency market, the Australian dollar is lower against the U.S. dollar on Monday. The local unit was trading at US$0.7514, down from US$0.7523 on Friday.

The Japanese market is advancing after U.S. Treasury Secretary Steven Mnuchin said that the U.S. trade war with China is "on hold". Better-than-expected Japanese trade surplus for the month of April also boosted investor sentiment.

The benchmark Nikkei 225 Index is adding 83.18 points or 0.36 percent to 23,013.54, off a high of 23,038.64 earlier.

The major exporters are mostly lower despite a slightly weaker yen. Canon, Mitsubishi Electric and Panasonic are lower in a range of 0.2 percent to 0.4 percent, while Sony is adding 0.4 percent.

Automaker Toyota is rising 0.6 percent, while Honda is edging down less than 0.1 percent. In the banking sector, Mitsubishi UFJ Financial is edging lower by 0.1 percent and Sumitomo Mitsui Financial is down 0.2 percent.

Among oil stocks, Inpex is advancing almost 1 percent and Japan Petroleum Exploration is adding 0.5 percent despite crude oil prices declining on Friday.

In the tech space, Advantest is declining almost 4 percent, while Kyocera is adding 0.3 percent and Alps Electric is rising almost 1 percent.

Among the market's best performers, Tokai Carbon is gaining almost 5 percent, while Fujikura and Asahi Glass Co. are rising more than 4 percent each.

On the flip side, Sompo Holdings is losing more than 5 percent, MS&AD Insurance Group is declining more than 3 percent and Screen Holdings is down almost 3 percent.

In economic news, the Ministry of Finance that Japan posted a merchandise trade surplus of 625.977 billion yen in April, up 30.9 percent on year. The headline figure exceeded expectations for a surplus of 440.0 billion yen following the downwardly revised 797.0 billion yen surplus in March.

Exports were up 7.8 percent on year to 6.822 trillion yen, missing forecasts for an increase of 8.7 percent but up from 2.1 percent in the previous month. Imports advanced an annual 5.9 percent to 6.196 trillion yen versus expectations for 9.8 percent following the 0.6 percent contraction a month earlier.

In the currency market, the U.S. dollar is trading in the upper 110 yen-range on Monday.

Elsewhere in Asia, Singapore, Hong Kong and Taiwan are all rising more than 1 percent each, while Shanghai, South Korea and Malaysia are also higher. Meanwhile, New Zealand and Indonesia are lower.

On Wall Street, stocks closed mixed on Friday in a lackluster session as traders seemed reluctant to make more significant moves amid a quiet day on the U.S. economic front. Uncertainty about the outcome of the second round of trade talks between the U.S. and China also kept some traders on the sidelines.

The Dow inched up 1.11 points or less than a tenth of a percent to 24,715.09, but the Nasdaq fell 28.13 points or 0.4 percent to 7,354.34 and the S&P 500 dipped 7.16 points or 0.3 percent to 2,712.97.

The major European markets saw modest weakness on Friday. While the German DAX Index fell by 0.3 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index both edged down by 0.1 percent.

Crude oil futures slipped on Friday, but posted a third straight week of gains. WTI crude dipped $0.21 or 0.3 percent to $71.28 a barrel on the New York Mercantile Exchange.