Asia-Pacific shares climbed on reports that Oracle had struck a deal for the US operations of Chinese video-sharing app TikTok, raising hopes of a resolution to a flashpoint in relations between Washington and Beijing.
Japan’s Topix index rose 0.8 per cent in early trading on Monday while South Korea’s Kospi climbed 1 per cent and Australia’s S&P/ASX 200 added 0.6 per cent. Hong Kong’s Hang Seng climbed 0.5 per cent and China’s CSI 300 of Shanghai- and Shenzhen-listed stocks gained 0.6 per cent.
Futures markets pointed to gains for US technology stocks while shares in Japan’s SoftBank jumped by their most since March.
Traders were emboldened following reports that Chinese tech group ByteDance had reached a preliminary “technical partnership” agreement with US software group Oracle for TikTok’s American operations. The deal does not include a full sale of the app, which President Donald Trump has threatened to ban after alleging it threatened national security.
Oracle, chaired by Trump administration supporter Larry Ellison, is likely to own a minority stake in TikTok’s US business while addressing the White House’s security concerns, the Financial Times reported.
In Tokyo, shares in SoftBank rose as much as 10 per cent after it agreed to sell Arm Holdings to US chip company Nvidia for $40bn. Its disposal of the UK-based chip designer underscores the Japanese conglomerate’s shift towards becoming a global investment powerhouse.
The FT also reported that SoftBank executives had revived discussions about taking the group private based on frustrations over the longstanding discount in its shares compared to the value of its individual holdings.
Futures markets tipped Wall Street’s technology-focused Nasdaq Composite to rise 1 per cent when trading begins later on Monday and the S&P 500 to add 0.8 per cent.
Adding to markets’ positive hue on Monday was news that Oxford university and AstraZeneca were to resume the international clinical trial of their proposed coronavirus vaccine candidate after pausing it a week earlier due to a participant falling ill.
“Expect continued focus on tech this week, though risk sentiment overall may be boosted on weekend news that AstraZeneca would resume phase 3 vaccine trials in the UK,” said Tapas Strickland, director of economics at National Australia Bank.
Investors are also this week looking ahead to important central bank decisions, including those by the US Federal Reserve, the Bank of Japan and the Bank of England.