Asian markets were mixed on Tuesday as investors tracked developments in the China-US trade talks, while Chinese online retail titan Alibaba surged almost eight percent on its Hong Kong debut.
While the mood remains upbeat across trading floors that a partial tariffs agreement will eventually be signed, there is a sense of unease about the lack of detail from both sides.
On Tuesday, Chinese Vice Premier Liu He spoke by phone to US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, state media said.
The two sides "discussed solving issues regarding each other's core concerns, reached consensus on properly resolving related issues, and agreed to maintain communication on remaining issues in consultations on the 'phase one' deal," China's official Xinhua news agency said, without providing more details.
The news came after Beijing said at the weekend it would hike penalties on violations of intellectual property rights and also look at lowering the threshold for criminal punishments of those who steal IP.
The IP issue is a major sticking point for the United States in the discussions and agreement on it is seen as key to their success.
The signals from the two economic giants are growing increasingly positive and observers said there is a need for both sides to nail the partial deal, which is part of a wider agreement.
"There are more incentives now on both sides to get this trade deal done compared to when the trade talks first fell apart earlier this year because the Chinese economy has slowed down much more since then and in the US, Trump is facing his 2020 election campaign," Amy Xie Patrick at Pendal Group told Bloomberg TV.
Alibaba stars on debut
Wall Street's three main indexes ended at new records Monday.
However, Asia struggled to extend its own advances from the day before.
Hong Kong dropped 0.3 percent, Singapore and Seoul fell 0.1 percent, and Jakarta and Manila shed 0.3 percent.
However, Tokyo rose 0.4 percent as the trade optimism lifted the dollar against the yen, providing a boost to Japanese exporters, while Shanghai was flat.
Sydney and Wellington both climbed 0.8 percent, while there were also gains for Mumbai, Bangkok and Taipei.
"Optimism is rising that a phase one trade deal could be agreed before December 15 when new US tariffs are expected to kick in," said Michael Hewson, chief market analyst at CMC Markets UK.
"However it seems much more likely that these could well be deferred once more, with an agreement more likely to occur sometime in the New Year, if we get one at all."
But he added: "The continued impasse remains a clear and present danger to the global economy."
In Hong Kong, Chinese e-commerce titan Alibaba surged 7.7 percent as it began trading for the first time following an USD 11 billion initial public offering, which is the city's biggest since 2010. It ended at 187.60 HK dollars, up 6.6 percent from its listing price.
Asia's most valuable firm, which is already traded in New York, said the decision to list in Hong Kong was a vote of confidence in the city, which has been hit by months of violent protests and the trade war.
In early trade London rose 0.1 percent, while Paris and Frankfurt were flat.(AFP)
Key figures around 0820 GMT
Tokyo - Nikkei 225: UP 0.4 percent at 23,373.32 (close)
Hong Kong - Hang Seng: DOWN 0.3 percent at 26,913.92 (close)
Shanghai - Composite: FLAT at 2,907.06 (close)
London - FTSE 100: UP 0.1 percent at 7,402.32
Euro/dollar: UP at USD 1.1015 from USD 1.1011 at 2215 GMT
Pound/dollar: DOWN at USD 1.2886 from USD 1.2898
Euro/pound: UP at 85.47 pence from 85.31 pence
Dollar/yen: UP at 108.99 yen from 108.91 yen
West Texas Intermediate: DOWN 10 cents at USD 57.91 per barrel
Brent North Sea crude: DOWN six cents at USD 63.59 per barrel
New York - Dow: UP 0.7 percent at 28,066.47 (close)