Asia-Pacific

Stocks, oil higher on muted trade optimism

Asian shares are at near four-month lows as the US-China trade dispute lingers.

Asian shares have been hobbled to near four-month lows on worries the US-China trade spat was developing into a more entrenched strategic dispute between the world's two largest economies.

MSCI's broadest index of Asia-Pacific shares outside Japan stood flat, hovering near its fresh four-month low marked on Thursday, and was on track for a third straight weekly loss, down 0.9 per cent so far.

Japan's Nikkei average dropped 0.6 per cent.

On Wall Street, the Dow Jones Industrial Average fell 1.1 per cent, the S&P 500 lost 1.2 per cent and the Nasdaq Composite dropped 1.6 per cent.

US President Donald Trump said on Thursday Washington's complaints against Huawei might be resolved within the framework of a US-China trade deal while also calling the Chinese telecommunications giant "very dangerous."

Washington last week effectively banned US firms from doing business with Huawei, the world's largest telecoms network gear maker.

As flight-to-safety plays dominated the global markets, the benchmark 10-year US Treasury note yield hit 2.292 per cent, the lowest level since October 2017.

Chotaro Morita, chief fixed income strategist at SMBC Nikko Securities, said big falls in the US manufacturing survey appear to reflect expectations of a breakdown in the US-China trade talks.

The greenback at one point hit its highest level in two years against a basket of six major currencies and the euro slumped to levels last seen in May 2017 as a recovery in Eurozone business activity proved soft.

The dollar hit a high of 98.371 against a basket of six major currencies overnight. The index was last quoted at 97.880, unchanged on the day.

Sterling weakened again on Thursday as pressure mounted on British Prime Minister Theresa May to name a date for her departure after backlash over her last-ditch plans for Britain's European Union exit.

It was last traded at $US1.2662, little changed on the day. The pound suffered its 14th consecutive day of losses against the euro on Thursday, its longest losing streak on record. It stood at 0.8830 pound to the euro.

In commodity markets, oil prices plunged on Thursday, with WTI crude losing nearly six per cent as trade tensions dampened the demand outlook.

In early Asian trade, US crude rebounded 0.6 per cent to $US58.25 ($A84.42) a barrel after Thursday's 5.7 per cent fall that took it to a two-month low.

Stay up to date with SBS NEWS

  • App
  • Subscribe
  • Follow
  • Listen
  • Watch