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Asia Markets

July 16, 2019, 11:39 p.m. EDT

Asian markets pull back as trade tensions resurface

Stocks retreat in Tokyo, Hong Kong as Trump says ‘long way to go’ for trade deal

By Marketwatch and Associated Press


Reuters
Containers are seen at a port in Ningbo, China.

Asian markets slipped in early trading Wednesday as trade tensions between the U.S. and China rose to the forefront again.

Following reports Monday that trade negotiations could resume soon, President Donald Trump threw water on investors’ optimism Tuesday, saying “We have a long way to go” before any deal. Trump added that he could impose tariffs on another $325 billion of Chinese imports if he wants to .

Separately, amid reports that the Trump administration may soon allow some U.S. companies to resume business with Chinese tech giant Huawei Technologies Co., bipartisan legislation was introduced in the Senate that would block Huawei from being removed from the government’s blacklist without congressional approval.

Japan’s Nikkei (NIKKEI:JP:NIK)   retreated 0.4%, and Hong Kong’s Hang Seng Index (HONG:HK:HSI)   slid 0.3%. The Shanghai Composite (SHG:CN:SHCOMP)   edged down 0.2%. South Korea’s Kospi (KOREA:KR:180721)   fell 0.9%, and benchmark indexes in Taiwan (TAIWAN:TW:Y9999)  , Singapore (SES:SG:STI)   and Indonesia (INDONESIA:ID:JAKIDX)   all declined. Australia’s S&P/ASX 200 (S&P:AU:XJO)   was one of the region’s few gainers, rising 0.4%.

Among individual stocks, SoftBank (TKS:JP:9984)   fell in Tokyo trading, along with Fast Retailing (TKS:JP:9983)   and Nintendo (TKS:JP:7974)  . In Hong Kong, Geely Automobile (HKG:HK:175)   rose, while oil producer CNOOC (HKG:HK:883)   and food processor WH Group (HKG:HK:288)   declined. Samsung (KRX:KR:005930)   dropped in South Korea and Taiwan Semiconductor (TAI:TW:2330)   fell in Taiwan. In Australia, BHP (ASX:AU:BHP)   and Beach Energy (ASX:AU:BPT)   gained while Oil Search (ASX:AU:OSH)   fell.

“President Trump’s renewed threat of more tariffs on Chinese goods has investors bracing for weak trading in the Asian session today, tracking the negative sentiment in the U.S. overnight,” ING economists Nicholas Mapa and Prakash Sakpal said in their report.

The S&P 500 (S&P:SPX)   fell 10.26 points, or 0.3%, to 3,004.04. That marks the first decline in the benchmark index after five days of gains. The Dow Jones Industrial Average (DOW:DJIA)   fell 23.53 points, or 0.1% to 27,335.63. The Nasdaq composite (AMERICAN:COMP)   fell 35.39 points, or 0.4%, to 8,222.80.

The latest round of U.S. corporate financial reports ramps up this week and investors have low expectations. Wall Street is forecasting a 2.6% drop in profit for S&P 500 companies. It is set to be the first back-to-back quarterly decline in three years.

Also highly anticipated is the Federal Reserve meeting at the end of the month. Wall Street expects the central bank to raise interest rates to help secure U.S. economic growth threatened by a trade war with China.

Benchmark U.S. crude   added 2 cents to $57.64 a barrel. It fell $1.96 to settle at $57.62 per barrel Tuesday. Brent crude  , the international standard, rose 21 cents to $64.56 a barrel.

The dollar (XTUP:USDJPY)   rose to 108.16 Japanese yen from 107.98 late Tuesday.

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