Asian markets mixed as US-China trade tensions linger
Asian markets were mixed on Wednesday as trade tensions continued to linger between the U.S. and China.
Shares in mainland China edged down on the day, with the Shanghai composite declining 0.49% to 2,891.70 and the Shenzhen component lower by 0.51% to 9,041.22. The Shenzhen composite fell 0.506% to 1,540.85.
Shares of Chinese surveillance tech company Hikvision dropped 5.54% after the New York Times reported that the U.S. administration is pondering restrictions on the company’s ability to buy American technology.
Meanwhile, Hong Kong’s Hang Seng index rose about 0.2%, as of its final hour of trading.
Elsewhere in the region, the Nikkei 225 in Japan rose fractionally to close at 21,283.37 as shares of index heavyweight Fast Retailing rose. The Topix, on the other hand, slipped 0.26% to end its trading day at 1,546.21.
In South Korea, the Kospi recovered from its earlier slip to close 0.18% higher at 2,064.86, as industry heavyweight Samsung Electronics’ stock rose 0.81%. Over in Australia, the ASX 200 added 0.16% to close at 6,510.70..
Overnight on Wall Street, the Dow Jones Industrial Average gained 197.43 points to close at 25,877.33. The S&P 500 added 0.9% to end the trading day at 2,864.36, while the Nasdaq Composite closed 1.1% higher at 7,785.72.
The moves came after the U.S. temporarily backed off on restrictions on Chinese telecommunications giant Huawei.
The Commerce Department said Monday night it would allow Huawei to purchase American-made goods in order to maintain existing networks and provide software updates to existing Huawei handsets until Aug. 19. The move sought to minimize disruption for the telecom company’s customers around the world. The initial restrictions worried investors that the ongoing U.S.-China trade war was intensifying.
Yet, tensions continue to remain between the two economic powerhouses.
Chinese President Xi Jinping signaled there would be no end to the trade war in the near future. China’s ambassador to the U.S. also told Fox News on Tuesday that Washington “changes its mind so often ” in the trade negotiations.
“We’re recommending … to clients that they position into other Asian names, especially Southeast Asian names,” David Riedel, president and founder of Riedel Research Group, told CNBC’s “Squawk Box” on Wednesday.
“I think there’ll be other good opportunities in Asia. But I think it’s going to be hard to be successful … in Hong Kong and China as these continue to go on and the trade continues to be a source of tension,” he said.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 98.103 after seeing an earlier low of 97.996.
The Japanese yen traded at 110.39 against the dollar after weakening from levels around 110.0 in the previous session. The Australian dollar changed hands at $0.6879, following its drop from highs above $0.690 yesterday after the country’s central bank governor said an interest rate cut will be considered in June.
Oil prices declined in the afternoon of Asian trading hours, with the international benchmark Brent crude futures contract slipping 0.68% to $71.69 per barrel. The U.S. crude futures contract also fell 1.06% to $62.46 per barrel.
Source: CNBC
