Asian stocks rebound on renewed hopes of US-China trade deal

US suspending $250 billion tariff hike on China
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U.S., China flags.

Asian stocks mostly rebounded on Thursday following a broad decline on Wednesday, as hopes renewed that the United States and China could be closer to a near-term trade deal.

Japan’s Nikkei 225 advanced as much as 1% in early trading. It was last up 0.7%, still leading gains in the region. Investors are also looking ahead to details of a $120 billion stimulus package in Japan that could come out as soon as Thursday.

Hong Kong’s Hang Seng gained 0.3%. China’s Shanghai Composite added 0.4%. South Korea’s Kospi briefly rose 0.7%, but reversed the gains and fell 0.4% later in the morning.

Markets have been sensitive to developments in US-China trade talks.

The US and China were moving closer to agreeing on the amount of tariffs to be rolled back, Bloomberg reported on Wednesday.

That helped to alleviate concerns about a delay in the trade deal, according to Jingyi Pan, a market strategist for IG Group.

On Wednesday, stocks fell sharply after President Donald Trump suggested to reporters in London that a deal with Beijing might have to wait until after the 2020 election.

That contradicted remarks made last month, when Trump said the US and China were “potentially very close” to striking a deal.

The back-and-forth on US-China trade negotiations remains “the primary engine behind the twist and turns” for stock markets, Pan said.

It remains uncertain whether the US will impose the next round of tariffs on China on December 15. And that uncertainty could continue to drive the markets, she added.