Asian markets gain as U.S., China agree to go back to the negotiating table

Asian markets mostly gained in early trading Monday, after the U.S. and China over the weekend agreed to a timeout in their tariff war and agreed to resume trade negotiations.

After meeting with China’s President Xi Jinping on Saturday at the G-20 summit in Japan, President Donald Trump said that current tariffs would remain in place, but new ones would be placed on hold for the “time being.” Trump said his talks went “even better than expected” and that “we’re going to work with China where we left off.” Despite his optimism, the U.S. and China remain entrenched in their positions, and it is unclear how long it may take to reach a final agreement. The two sides haven’t met for formal negotiations since talks broke off in early May.

Japan’s Nikkei












NIK, +1.80%










  rose 1.7%, but Hong Kong’s Hang Seng Index












HSI, -0.28%










  retreated 0.2% as protesters and police again faced off in the streets. The Shanghai Composite












SHCOMP, +2.15%










 gained 1.9% and the smaller-cap Shenzhen Composite












399106, +3.13%










  surged 2.4%, despite data that China’s manufacturing activity slumped into contraction territory in June. South Korea’s Kospi












180721, +0.12%










  was about flat, while benchmark indexes in Taiwan












Y9999, +1.59%










 , Singapore












STI, +1.24%










  and Indonesia












JAKIDX, +0.24%










  advanced. Australia’s S&P/ASX 200












XJO, +0.52%










  gained 0.6%.

“After spending the better part of two months in trade war purgatory and with G-20 done and dusted, risk markets have responded to Saturday’s events in a reveller tone,” Stephen Innes, managing partner at Vanguard Markets, said in a note Monday. “Indeed, investors heaved a massive, but exhausted, sigh of relief.”

“The biggest question on everyone’s mind is will any armistice stick or will history repeat, and trade war gridlock set in?” he added.

Among individual stocks, Japan Steel












5631, +6.06%










  surged in Tokyo trading. Sony












6758, +1.74%










  and robotics maker Fanuc












6954, +2.58%










  also rose, while Rakuten












4755, -3.52%










  slid. In Hong Kong, food processor WH Group












288, -3.18%










  fell, along with Wharf Real Estate












1997, -1.61%










  and PetroChina












857, -0.92%










 . Samsung












005930, -0.74%










  and LG Electronics












066570, -3.53%










  declined in South Korea. Foxconn












2354, +1.11%










  and Taiwan Semiconductor












2330, +4.18%










  gained in Taiwan, and Oil Search












OSH, +2.05%










  advanced in Australia.