HONG KONG (Nikkei Markets) -- Asian shares outside of Japan jumped Wednesday, helped by increased prospects of a U.S.-China trade deal and the European Central Bank's hints about stimulus measures.
The Nikkei Asia300 Index of companies outside Japan advanced 2.2% to 1,299.42. Chinese companies were among the biggest winners on the gauge. Hong Kong shares of pork producer WH Group, which has significant business interests in the U.S., surged 5.3%. Air China led airlines higher, climbing 8.3%. Analysts said an improved outlook on the Chinese yuan on hopes of a U.S.-China trade deal boosted mainland airlines. Guangzhou Automobile Group paced the advance in carmakers, adding 5.8%, and China Life Insurance led financial companies higher, climbing 3.1%.
Asian equities were buoyed by U.S. President Donald Trump's comments on Twitter that he would have an "extended meeting" with Chinese President Xi Jinping next week at the G-20 summit in Japan. The meeting was confirmed by Xi, who reportedly said that he was willing to meet Trump and exchange views.
A meeting between the two leaders was earlier in doubt amid Trump's threat of imposing tariffs on more Chinese goods if Xi did not meet him at the G-20 summit and Beijing's refusal to confirm.
Further helping the risk appetite were remarks by ECB head Mario Draghi that in the absence of an improvement in economic indicators, the central bank's inflation target was being threatened. This, he added, may require additional stimulus in the form of a cut in interest rates or asset purchases. Following his comments, European equities and bonds gained yesterday.
"The prospects of a better growth outlook as trade relations improve, combined with a backstop from the ECB, forced underweight investors back into the market," Michael McCarthy, the chief market strategist at CMC Markets and Stockbroking, said. "The sudden shift in markets means the U.S. Federal Reserve announcement has even higher potential to influence trading."
The Fed, later Wednesday, is expected to adopt a dovish bias and indicate that it will likely cut interest rates next month.
In other movers on the A300, ZTE added 7.4%. The Chinese telecom equipment provider is currently banned by the U.S. from buying components and technology from American companies.
Want Want China Holdings rose 3.4%, extending Tuesday's 1.7% advance, after the food and beverage company reported an 11.6% increase in full-year profit. The company late Tuesday said its unit agreed to acquire egg producer Poyang County Linwang Forestry Development.
The improved likelihood of a trade deal lifted industrial commodity and oil producers. India's Vedanta rose 0.2% and Tata Steel advanced 4.6%, while CNOOC and China Petroleum & Chemical advanced at least 2.9% each.