Markets mixed as China's Xi arrives for US talks

HONG KONG: Asian markets were mixed on Thursday as traders eyed a high-stakes summit between US President Donald Trump and Chinese leader Xi Jinping set to focus on AI, trade and the Middle East war.

Xi's arrival in Washington coincided with US Treasury Scott Bessent announcing that the superpowers had agreed to extend a trade truce by two months.

The simmering trade war between the world's top two economies is a key concern: while both sides have maintained a tariff truce for nearly a year, they have yet to secure a lasting agreement.

The "economic detente" will now extend beyond its Nov 10 deadline to Jan 10, Bessent said.

But hopes of business deals have been dimmed by the fact that there are no Chinese CEOs in Xi's delegation, two sources told AFP.

In contrast, top US tech bosses including the leaders of major AI companies are set to attend Thursday's banquet.

Pre-summit talks between Bessent and his Chinese counterpart He Lifeng included discussion of creating a communication channel for AI concerns, as warnings swirled that the technology risks wiping out humanity.

"Market participants are looking for signs of cooperation (however feigned) in managing the risks of AI without raising the regulatory risk to the space," said Kyle Rodda, senior financial market analyst at Capital.com.

OIL COOLS

Hong Kong, Shanghai and Taipei were in the red, while South Korea's tech-heavy Kospi was closed for a holiday.

Japan's Nikkei was 1.6 per cent up as it reopened after a three-day break.

Tokyo's gains came as the benchmark 10-year JGB yield rose to 3.055 per cent, hitting a 30 year high, after US bond yields jumped.

The benchmark US 10-year Treasury yield rose to 5.11 per cent -- its highest level since 2007.

The US Federal Reserve lifted borrowing costs last week, providing relief to traders concerned that policymakers were not moving quickly enough to address a spike in inflation.

The Iran war will be also on the agenda at US-China talks in Washington, Trump confirmed, despite having earlier played down reports that Beijing was supplying Tehran with intelligence as the conflict drags on.

Oil prices cooled off on Thursday after jumping sharply as world leaders at the UN General Assembly offered little to suggest progress in ending the turmoil in the Middle East.

The international benchmark, Brent crude, was down one per cent in early Asian trade after soaring more than three per cent the previous day.

Hopes for a deal to get Gulf oil and gas flowing freely through the Strait of Hormuz as global leaders gathered in New York had sent oil prices down in recent sessions.