HONG KONG: Asian stocks eased Thursday as traders anxiously awaited news from high-level US-China talks under way in Beijing while official data showed trade between the world’s two largest economies plunged.
Negotiators kicked off discussions in the Chinese capital aimed at defusing a row that has already triggered tariffs on billions of dollars’ worth of exports and threatened to stymie global growth, reports AFP.Failure to resolve the dispute would initiate a sharp hike in US tariffs on $200 billion of Chinese goods, although President Donald Trump indicated this week he could extend his March 1 deadline if progress is made in Beijing.
Trump told reporters in the Oval Office on Wednesday that preliminary discussions in Beijing had gone “very well”, Bloomberg reported, adding that the US president was considering a 60-day deadline extension according to unnamed sources. “Based on the positive signals from the US-China trade negotiations, further tariff hikes will likely be suspended,” noted Louis Kuijs of Oxford Economics, as US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin met with China’s top economic czar Liu He.
But a wide gulf remains on some issues. The US is demanding far-reaching changes to Chinese practices that it says are unfair.
Hong Kong dropped 0.2 percent from its highest closing level in six months the previous day, while Shanghai edged down 0.1 percent.
An unexpected rise in Chinese exports — particularly to Europe and Southeast Asia — had little bearing on markets as imports for January fell, with reciprocal tariffs taking effect and the domestic economy continuing to slow.
China’s huge trade surplus with the US — a source of anger within the Trump administration — narrowed from December to $27.3 billion.But Chinese exports across the Pacific were down two percent, and American imports plunged 41 percent, compared to the previous January.