HONG KONG, China (AFP) — Asian markets mostly rose Tuesday, taking up the baton after a record close on Wall Street, with investors filled with a renewed sense of hope over China-US talks, while the pound was winning support from easing Brexit fears.

Expectations for another Federal Reserve interest rate cut this week and a strong corporate reporting season were also providing a much-needed lift to confidence after a rollercoaster year on global trading floors.

Donald Trump reinforced optimism that the world’s economic superpowers are on track to resolve their tariffs war by saying the two sides were “ahead of schedule” on the first phase of a wider deal and he hoped to sign it with Xi Jinping next month.

His comments came after officials from Washington and Beijing hailed progress in top-level talks on Friday.

“So far the soundings coming from both the US and China point to the likelihood significant progress in trade negotiations,” said National Australia Bank analyst Rodrigo Catril.

But he added that while they appeared to have reached agreement on key issues, it “is probably worth noting that so far neither party has officially said anything about the contentious issue surrounding China’s demand for a pullback on US tariffs”.

Investors, he said, seemed to be betting on that the improved relations will see the US suspend new levies due in December, or even roll back those imposed last month. However, he warned: “This is a big assumption as talks could easily fail again if both parties don’t find a compromise.”

Hong Kong and Seoul each edged up 0.1 percent while Tokyo went into the break 0.5 percent higher with Singapore jumping more than one percent.

Sydney was flat, while there were gains in Taipei but Shanghai slipped 0.4 percent.

“It looks as if we’ve pretty much hit the bottom in some sectors and we should actually be near an inflection point,” Margie Patel at Wells Fargo Asset Management told Bloomberg TV.

“We’ve had the Fed cutting rates pretty much all of this year. It takes a while for that to feed into the economy. I think the worst is pretty much behind us.”

Sterling capped 

While the earnings season is in full swing, investors are also keeping tabs on the Fed’s next policy meeting this week, which could see it cut borrowing costs once again.

But OANDA senior market analyst Jeffrey Halley said: “Part of the overnight rally on Wall Street was also driven by the almost 100 percent expectation, that the (Fed policy board) will cut rates.

“Yet here we are with the record, or near-record, highs in US stocks, an interim trade deal on the horizon, mostly peachy US earnings, and US data that is overall, still well on the bright side.”

Also in focus are events in London where Boris Johnson will try on Tuesday to pass a bill that would allow him to call a general election in December.

Having failed to get the two-thirds majority in parliament to take Britain to the polls, the prime minister will now put forward a second plan to legislate for a poll on December 12, which would require only a simple majority to pass.

Johnson is confident he can win a majority at the national vote that will allow him to push through his stalled Brexit deal.

The move comes after European leaders granted another three-month extension to the Brexit deadline, just days before Britain was about to crash out of the bloc without a deal.

Sterling rallied on the EU decision, though analysts pointed out that the continued uncertainty was keeping a lid on the currency for now.

“Although a hard Brexit looks almost impossible now, electoral uncertainty will make pound rallies past $1.3000 nearly as unlikely in the near-term,” said Halley.

Oil prices were flat after Monday’s big losses that were sparked by reports of another pick-up in US stockpiles that indicate weakening demand, which offset the upbeat vibe caused by the trade talks.

Key figures around 0230 GMT 

Tokyo – Nikkei 225: UP 0.5 percent at 22,975.13 (break)

Hong Kong – Hang Seng: UP 0.1 percent at 26,905.92

Shanghai – Composite: DOWN 0.4 percent at 2,967.95

Pound/dollar: DOWN at $1.2847 from $1.2859 at 2100 GMT

Euro/pound: UP at 86.39 pence from 86.29 pence

Dollar/yen: UP at 108.98 yen from 108.95 yen

Euro/dollar: DOWN at $1.1094 from $1.1099

West Texas Intermediate: DOWN eight cents at $55.73 per barrel

Brent North Sea crude: UP one cent at $61.58 per barrel

New York – Dow: UP 0.5 percent at 27.090.72 (close)

London – FTSE 100: UP 0.1 percent at 7,332.28 (close)

© Agence France-Presse