Global markets lifted by growing trade optimism

• "Equity markets are posting gains, but the upside moves are not massive as dealers are mindful that things still could fall apart."
• The trade war has taken the place of the Fed in being what investors are hanging their hat on.
• Trump did not indicate whether he would put his name to the bill, instead emphasising close ties to Xi Jinping and efforts to seal the trade agreement.

LONDON: Most stock markets crept ahead Wednesday on rising expectations that China and the United States would reach an interim trade deal after President Donald Trump said the talks were "in the final throes".

Observers said that while the broad consensus is that the two would wrap up something soon, there was an underlying unease at the lack of detail that prompted lingering uncertainty.

"Trade optimism has lifted stocks," CMC Markets analyst David Madden said even as he urged caution.

"Equity markets are posting gains, but the upside moves are not massive as dealers are mindful that things still could fall apart."

For Craig Erlam, senior market analyst at Oanda, "the sudden daily obsession with the trade war probably has a lot to do with the fact that there's very little else to talk about at the moment, which doesn't bode well for the rest of the year.

"The trade war has taken the place of the Fed in being what investors are hanging their hat on," Erlam added as European stocks crept marginally ahead mid-session while the Dow marked time in early trading.

Trump said Tuesday: "We're in the final throes of a very important deal, I guess you could say one of the most important deals in trade ever."

But he also raised the issue of unrest in Hong Kong, which has become a possible sticking point after Congress passed a bill supporting the pro-democracy protests and sent it to Trump to sign into law.

Progress on the bill has angered Beijing, however, and fuelled concerns it could upend the trade talks.

Trump did not indicate whether he would put his name to the bill, instead emphasising close ties to Xi Jinping and efforts to seal the trade agreement.

"It's going very well but at the same time we want to see it go well in Hong Kong," he said. "I think it will. I think that President Xi can make that happen. I know him and I know he'd like to make it happen."

Hong Kong rose 0.2 percent, with e-commerce titan Alibaba piling on more than three percent a day after its city debut that saw it gain more than six percent.

Tokyo ended 0.3 percent higher and Sydney jumped 0.9 percent.

However, Shanghai fell 0.1 percent after data showed that industrial company profits tumbled by 10 percent in October on an annual basis, highlighting continued problems in the world's number two economy.

The pound meanwhile diverged as opinion polls showed the main opposition Labour party closing the gap on Prime Minister Boris Johnson's Conservatives just over two weeks before the general election.

Sterling has been given a lift in recent weeks by expectations Johnson would win a workable parliamentary majority that would allow him to push through his Brexit plan.

Key figures around 1750 GMT

London - FTSE 100: UP 0.4 percent at 7,429.78 points (close)

Frankfurt - DAX 30: UP 0.4 percent at 13,282.34 (close)

Paris - CAC 40: DOWN 0.1 percent at 5,926.84 (close)

New York - Dow: FLAT at 28,123,11

EURO STOXX 50: UP 0.2 percent at 3,712.78

Tokyo - Nikkei 225: UP 0.3 percent at 23,437.77 (close)

Hong Kong - Hang Seng: UP 0.2 percent at 26,954.00 (close)

Shanghai - Composite: DOWN 0.1 percent at 2,903.19 (close)

Euro/dollar: DOWN at $1.0999 from $1.1021

Dollar/pound: UP at $1.2881 from $1.2866

Euro/pound: DOWN at 85.59 pence from 85.66 pence

Dollar/yen: UP at 109.38 yen from 109.05 yen

Brent North Sea crude: DOWN 1.0 percent at $62.59 per barrel

West Texas Intermediate: DOWN 1.2 percent at $57.64 per barrel