Asian stocks set for gains after tariffs take effect; dollar softer

FAN Editor

Asian shares were set for gains on Monday, taking cues from Wall Street’s advance following the release of strong employment data for the month of June. Meanwhile, trade remained a closely watched area for investors after the U.S. and China exchanged tariffs last week.

Futures tipped higher opens for Japan and Australia on the first trading day of the week. Nikkei futures traded in Chicago were up 0.33 percent compared to the benchmark’s last close and over in Australia, SPI futures were higher by 0.42 percent at the end of the Friday session.

U.S. stocks had advanced on Friday as investors focused on better-than-expected jobs data stateside. The Dow Jones Industrial Average rose 0.41 percent, or 99.74 points, to close at 24,456.48, the S&P 500 gained 0.85 percent to end at 2,759.82 and the Nasdaq composite surged 1.34 percent to finish at 7,688.39.

The U.S. economy added 213,000 jobs in June, topping the 195,000 forecast in a Reuters poll. Wage growth, however, slightly missed expectations.

That overshadowed developments on the trade front on Friday when U.S. tariffs on $34 billion in Chinese goods took effect, ramping up the country’s ongoing trade spat with China.

China followed up by promptly imposing duties of its own on the same value of U.S. products. China’s Ministry of Commerce said it had no choice but to respond to the U.S. after the latter “launched the largest trade war in economic history.”

U.S. President Donald Trump said on Friday that an additional $16 billion of Chinese goods would be subject to tariffs in two weeks, and that he was considering further slapping duties on an additional $500 billion in Chinese products.

In corporate news, smartphone maker Xiaomi debuts for trade in Hong Kong on Monday after the company priced its initial public offering at 17 Hong Kong dollars ($2.17) per share, the low end of an indicative range. Xiaomi said last month that it did not have a time frame for its share offering on the mainland.

Elsewhere, British Prime Minister Theresa May last week won agreement from her cabinet to remain in a free trade area for goods with the European Union, which analysts see as a “soft Brexit.” The pound firmed on the back of that news and last traded at $1.3301.

The dollar was broadly softer, with the dollar index at 93.954 at 7:07 a.m. HK/SIN. Against the yen, the dollar traded at 110.41.

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