Asia shares reap big gains on news of Trump-Xi phone chat

A man stands in front of an electronic board showing Hong Kong share index outside a bank In Hong Kong, Friday, Nov. 2, 2018. Asian shares advanced Friday after a strong finish on Wall Street helped by news of possible progress on resolving trade tensions between China and the U.S. (AP Photo/Kin Cheung)

Asian shares advanced Friday after President Donald Trump and his Chinese counterpart Xi Jinping spoke by phone and the Chinese state media reported progress in resolving trade tensions between their two countries.

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KEEPING SCORE: Hong Kong's Hang Seng index jumped 3.8 percent to 26,365.04 and the Shanghai Composite index added 2.7 percent to 2,676.48. Japan's Nikkei 225 index surged 2.6 percent to 22,243.66 while South Korea's Kospi climbed 3.5 percent to 2,096.00. The S&P ASX/200 in Australia erased early losses to end up 0.1 percent at 5,849.20 and the SET in Thailand rose 0.9 percent. Shares also rose in Taiwan, India and Southeast Asia.

CHINA-US TRADE: U.S. President Donald Trump tweeted that he spoke with Chinese President Xi Jinping and that the two countries were making some progress in trade negotiations. He didn't give details, but there have been few signs of movement in the trade dispute in recent months, and investors are getting nervous about the prospect of huge tariff increases. A Chinese foreign ministry spokesman told reporters the discussion was quite positive and that the two leaders were optimistic about resolving the dispute over technology that has resulted in both sides imposing penalty tariffs on billions of dollars' worth of each other's exports. Meanwhile, Chinese state media said Xi has promised tax cuts and other help to China's entrepreneurs in a renewed effort to revive the cooling, state-dominated economy.

WALL STREET: U.S. stocks continued their gradual rebound from a plunge that lasted almost the entire month of October, and many of the biggest gains Thursday came from stocks that struggled badly last month like chipmakers and other technology companies and smaller, domestically-focused companies. The S&P 500 index added 1.1 percent to 2,740.37. The Dow Jones Industrial Average also picked up 1.1 percent, to 25,380.74. The Nasdaq composite climbed 1.8 percent to 7,434.06 and the Russell 2000 index jumped 2.2 percent, to 1,544.98.

ANALYST'S VIEWPOINT: Liz Ann Sonders, chief investment strategist for Charles Schwab, said one reason for the recent market rout was that companies started to give more details about how much the tariffs could hurt them. "Companies are saying 'this is biting and here's how,'" she said. "They're starting to talk about profit margins and whether they're going to pass the expenses onto consumers."

CURRENCIES: The pound fell back after a rally based on a report that that Britain and the European Union had reached a deal to give U.K. financial services companies access to the bloc after Brexit. The article by The Times cited anonymous sources, and other reports suggested a deal had not yet been finalized. The British pound rebounded to $1.3014 from $1.3004. The dollar rose to 113.02 yen from 112.71 yen, while the euro gained to $1.1436.

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ENERGY: Oil prices continued to weaken after the Department of Energy said U.S. crude stockpiles increased for the sixth straight week. Benchmark U.S. crude slipped 4 cents to $63.65 per barrel in electronic trading on the New York Mercantile Exchange. It slumped 2.5 percent to $63.69 a barrel in New York. Brent crude, used to price international oils, picked up 17 cents to $72.06 per barrel. It shed 2.9 percent Thursday to $72.89 a barrel in London.

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AP Markets Writer Marley Jay contributed. He can be reached at http://twitter.com/MarleyJayAP

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