Asia-Pacific markets are preparing for a mixed session on Thursday as investors contemplate the outcome of discussions between U.S. President Joe Biden and Chinese President Xi Jinping. The talks took place outside of San Francisco, marking their first face-to-face encounter in a year. This meeting was part of ongoing efforts between the United States and China to enhance high-level communication amid continued tensions. Additionally, investors were evaluating whether the optimism surrounding signs of cooling U.S. inflation would persist throughout the day.
Meeting Between Biden and Xi Jinping
President Biden and President Xi Jinping engaged in discussions on the sidelines of the Asia-Pacific Economic Cooperation conference. Both countries are focused on fostering better communication and understanding, given the existing political and economic strains. The meeting garnered significant attention due to the potential impact on global trade and economic policies. Investors eagerly await any outcomes or statements that may influence market sentiment.
As news of the Biden-Xi discussions spreads, the reaction in Asia-Pacific markets remains unclear. The Nikkei 225 opened near flat levels at 33,517.26, and the Topix index slightly rose by 0.16%. Futures for Hong Kong’s Hang Seng index also indicated a higher open compared to the previous close. However, the South Korea stock market delayed its opening by an hour due to college entrance exams, which aimed to alleviate rush-hour traffic. The Australian S&P/ASX 200 saw a minor dip of 0.19%. Market participants will closely monitor the reaction in these markets as the day progresses.
Investors’ sentiment has been buoyed by positive U.S. inflation data. The latest report showed that October’s producer price index, which measures wholesale prices, experienced the largest monthly drop since April 2020, declining by 0.5%. This deflationary trend reassured market participants who have been concerned about rising inflationary pressures. The U.S. stock market responded positively to this news, with the S&P 500 advancing by 0.16% and the Nasdaq Composite edging higher by 0.07%. The Dow Jones Industrial Average also continued its upward trajectory, adding 163.51 points or 0.47% and extending its winning streak to four consecutive sessions.
Asia-Pacific markets are bracing for a mixed session as investors reflect on the Biden-Xi discussions and monitor the impact of encouraging U.S. inflation data. The outcome of the high-level communication between the U.S. and China will likely have far-reaching implications for global trade and economic policies. As the day progresses, market participants will closely observe the reaction in the Nikkei 225, Hang Seng index, South Korea stock market, and Australian S&P/ASX 200. Additionally, the positive inflation data from the United States has improved market sentiment, contributing to the recent rally in U.S. stocks. The market’s response to these developments will shape investor sentiment in the Asia-Pacific region.