A Chinese man monitors stock prices at a brokerage in Beijing on Friday, July 19, 2019. Asian shares rebounded Friday on hopes for progress in trade talks between China and the U.S., extending overnight gains on Wall Street. (AP Photo/Ng Han Guan)

Global shares rebound, extending Wall Street gains

July 19, 2019 - 5:04 am

BANGKOK (AP) — Shares powered ahead in Europe and Asia on Friday, helped by for progress in trade talks between China and the U.S. and by expectations that the U.S. central bank will cut interest rates soon.

Britain's FTSE 100 added 0.6% to 7,538.01 and the CAC 40 in Paris rose 0.8% to 5,593.98. In Germany, the DAX jumped 0.9% to 12,335.75. Wall Street looked set for gains, with the future for the Dow Jones Industrial Average up 0.5% to 27,329. The future for the S&P 500 added 0.4% to 3,008.00.

Reports that Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer spoke with their Chinese counterparts as planned, with more talks to come, helped ease concerns over the deepening trade war between Washington and Beijing.

The standoff over China's longstanding trade surpluses and its policies aimed at building up advanced high-tech industries has added to concerns over slowing demand and weaker Chinese growth.

Expectations that the U.S. Federal Reserve will move quickly to cut interest rates have also helped buoy sentiment.

Comments by the president of the Federal Reserve Bank of New York, John Williams, suggesting central banks need to "take swift action" when conditions turn adverse, have whetting investors' appetites for buying, analysts said.

"Investors are highly sensitive to dovish comments from Fed presidents these days, as they are trying to figure out whether the Fed would lower its interest rates by 50 basis points by the end of this month," Ipek Ozkardeskaya of London Capital Group said in a report.

"Given that a 50-basis-point cut would trigger a further rally in global equities, any remark of dovish nature translates immediately into higher asset prices," she said.

In Asian trading, Japan's Nikkei 225 index jumped 2.0% to 21,466.99 while Hong Kong's Hang Seng climbed 1.1% to 28,765.40. The Shanghai Composite index rose 0.8% to 2,924.20, while in South Korea, the Kospi added 1.4% to 2,094.36. India's Sensex slipped 1.3% to 38,390.88. Shares rose in Taiwan and Southeast Asia.

Investors are looking ahead to corporate earnings.

So far, in the U.S. the results have been mixed, though only about 13% of S&P 500 companies have reported, according to FactSet. Analysts expect profits to fall 2.4% overall by the time all reports are tallied.

ENERGY: Benchmark crude oil advanced 57 cents to $55.87 per barrel in electronic trading on the New York Mercantile Exchange. It fell $1.48 to settle at $55.30 a barrel on Thursday. Brent crude oil, the international standard, picked up 84 cents to $62.77 per barrel.

CURRENCIES: The dollar rose to 107.65 Japanese yen from 107.30 yen on Thursday. The euro weakened to $1.1250 from $1.1279.

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