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Nikkei Markets

Asian equities rise as US, China agree to roll back tariffs

Lenovo, Tata Steel decline after earnings

HONG KONG (Nikkei Markets) -- Asian shares outside of Japan advanced Thursday after China and the U.S. agreed to roll back tariffs on each other's shipments in phases.

The Nikkei Asia300 Index of companies outside Japan rose 0.4% to 1,351.41. WH Group, a Chinese meat processing company with interests in the U.S., climbed 0.8%. An index of Chinese companies listed in Hong Kong advanced 0.7%.

China's Ministry of Commerce said Thursday that the proportion of tariffs to be cancelled must be the same for both the sides to reach the phase-one of a trade deal. "In the past two weeks, top negotiators had serious, constructive discussions and agreed to remove the additional tariffs in phases as progress is made on the agreement," the ministry spokesman Gao Feng said.

Earlier in the day, risk appetite for Asian equities and currencies was damped by reports that hurt recent confidence surrounding the U.S. and China signing a partial trade deal this month. Reuters, citing a senior official of the Trump administration, reported that the signing of the interim trade deal could be delayed until December amid discussions over terms and venue. Bloomberg reported that two U.S. locations for the meeting between President Donald Trump and Chinese leader Xi Jinping had been ruled out and an interim deal may not be ratified this month as originally planned.

Chris Weston, the head research at Pepperstone Group, said that the recent upbeat risk sentiment could change if investors "believe a deal is not going to come to fruition." Considering the recent rally in equities on account of the trade deal optimism, it is not only important that a deal happens but what it looks like, he added.

Hong Kong-listed Macau casino operator Galaxy Entertainment Group ended little changed after falling as much as 1.6% earlier in the day following a 2% decline in third-quarter revenue. Its peer Wynn Macau slid 0.9% after saying net profit for the September quarter more than halved from a year ago and revenue fell 18.2%.

Lenovo Group, the world's largest personal computer maker, slipped 0.3%. The company reported a 20% rise in quarterly net profit on the back of robust growth in the mainstay PC and smart devices business.

BYD closed 0.8% higher after falling earlier in the day. The Chinese electric carmaker said October sales volume declined by 15.2% year-on-year.

Tata Steel declined 0.3%. While the Indian company reported a 6% year-on-year increase in net profit for the September quarter, its earnings before interest, taxes, depreciation, and amortization plunged 56%.

Public Bank closed 0.3% higher. Malaysia's third-largest lender by assets said Thursday its net profit fell 1.5% in the third quarter from a year earlier partly due to higher other operating expenses.

--Nimesh Vora

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