Asian stocks mixed amid renewed US-China tensions
Asian stocks were mixed on Tuesday afternoon amid renewed geopolitical tensions, with China accusing the U.S. of fueling cybersecurity fears.
Investors also awaited developments on the U.S.-China trade front. The White House said on Monday that trade talks between the two economic powerhouses will continue in Washington on Tuesday, with higher level negotiations starting later in the week.
Mainland Chinese markets were mixed, with the Shanghai composite rising about 0.16 percent while the Shenzhen component was 0.444 lower. The Shenzhen composite was down about 0.222 percent lower.
Hong Kong’s Hang Seng index also lost some ground, lower by about 0.36 percent, as shares of Chinese tech giant Tencent fell 0.4 percent.
Japan’s Nikkei 225 rose 0.23 percent and the Topix was 0.3 percent higher in afternoon trade, as shares of index heavyweight Fast Retailing shed earlier gains to slip 0.3 percent.
South Korea’s Kospi, on the other hand, was slightly lower.
The ASX 200 in Australia rose 0.3 percent in afternoon trade. Shares of health supplements company Blackmores, however, plummeted more than 23 percent after the company issued a weaker outlook for the second half of its fiscal year on the back of concerns over its sales in China.
Blackmores CEO Richard Henfrey told CNBC’s “Squawk Box” on Tuesday the company was likely to deliver profits in the second-half that are “a little bit lower” as compared to the first-half, as a result of “softening” consumer sales in China but also due to investments across its markets.
“We’re very confident in the long-term,” Henfrey said.
Chinese accuses US of fueling cybersecurity fears
The Chinese government said Monday that the U.S. is attempting to curtail its technology development by claiming that Chinese mobile network gear might pose a cybersecurity threat to foreign countries which adopt the equipment.
The U.S. alleged that Beijing might use Chinese tech companies to gather intelligence about foreign countries, even though those claims have yet to be substantiated.
U.S. President Donald Trump’s administration has been putting pressure on the country’s allies to shun networks supplied by Huawei, threatening the company’s access to markets for next-generation wireless gear.
The company, the biggest global maker of switching gear for phone and internet companies, denies accusations it facilitates Chinese spying and said it would reject any government demands to disclose confidential information about foreign customers.
“So far no one has provided any physical evidence that there is, you know, a security threat,” Stephane Teral, executive director of research and analysis at IHS Markit, told CNBC’s “Street Signs” on Tuesday.
“If it comes down to (banning) Huawei where it has a very significant footprint, the cost is tremendous because you cannot remove, you know, any Huawei equipment and replace it overnight,” Teral said.
Also on Monday, Huawei founder Ren Zhengfei told the BBC that the arrest of his daughter and chief financial officer of the company, Meng Wanzhou, was a “politically motivated act.”
Meng was arrested in Canada last December and currently faces possible extradition to the U.S., she was charged with bank and wire fraud to violate U.S. sanctions against Iran.
Currencies
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.885 after seeing lows around 96.65 yesterday.
The Japanese yen traded at 110.69 against the dollar after seeing an earlier high of 110.44. The Australian dollar changed hands at $0.7110 after seeing highs above $0.715 yesterday.
Oil prices were mixed in the afternoon of Asian trading hours. The international benchmark Brent crude futures slipped 0.39 percent to $66.24 per barrel. U.S. crude futures, however, gained 0.45 percent to $55.84 per barrel.
Source: CNBC
