ICEC

Asian markets, currencies down as US-China tariffs kick in

Australia and Hong Kong’s markets remained in broadly negative territory on Monday afternoon, following tariffs between the U.S. and China that kicked in.

The ASX 200 recovered from its earlier losses but still traded slightly lower in the afternoon, with the heavily weighted financial sector also making a turnaround. Commonwealth Bank of Australia, however, remained lower by 0.5 percent, while AMP slid further to trade down by 1.24 percent.

Rare earths miner Lynas continued to see its stock plunging to trade down by 20.71 percent, after the company announced earlier that it was aware of media speculation surrounding a possible review of its operations in Malaysia.

In the Greater China region, Hong Kong’s Hang Seng index remained in negative territory as it was lower by 1.25 percent in the afternoon, with property developer Country Garden’s stock still down by 5.75 percent.

The markets in Japan, South Korea and China are closed for public holidays on Monday.

The U.S.-China trade war remains in focus Monday, with tariffs from both parties going into effect at 12.01 p.m. HK/SIN. Washington had announced ten percent duties on $200 billion of Chinese imports, which prompted Beijing to respond with tariffs on $60 billion of U.S. goods. On Friday, the Wall Street Journal reported that China had called off planned trade talks with the U.S. in the wake of a new round of duties.

“The markets have started the week on the back foot after China pulled out of scheduled talks with the US just hours before the next round of tit for tat tariffs are due to be introduced,” said Rakuten Securities Australia in a morning note.

As the tariffs came into play, the safe-haven Japanese yen was largely flat against the dollar at 112.59, while the trade-sensitive Australian dollar slipped lower at $0.7267, as of 12:01 p.m. HK/SIN. The offshore yuan weakened by 0.28 percent against the dollar at 6.8662, while the South Korean won slid 0.44 percent against the greenback to 1,118.85.

The U.S. dollar currency index, which tracks the greenback against a basket of currencies, was at 94.266 as of 12:10 p.m. HK/SIN, strengthening slightly as compared to its performance in the morning of Asian trade.

In U.S. market action, the Dow Jones Industrial Average and S&P 500 saw record highs Friday. The Dow climbed 86.52 points higher to close at 26,743.50, while the S&P 500 ended largely flat at 2,929.67. The Nasdaq Composite, on the other hand, slid by 0.51 percent to close at around 7,986.96.

Source: CNBC

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