By Marketwatch and Associated Press
Asian markets were little changed in early trading Tuesday, as investors were rattled by a possible snag in a U.S.-Chinese trade truce following reports Beijing wants Washington to life punitive tariffs.
Japan’s Nikkei /zigman2/quotes/210597971/delayed JP:NIK -2.53% was up 0.1% while Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI -2.67% dipped 0.1%. The Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP -0.56% slipped 0.2% and the Shenzhen Composite /zigman2/quotes/210598015/delayed CN:399106 -0.20% fell 0.5%. South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 -1.47% rose 0.1% while benchmark indexes in Taiwan /zigman2/quotes/210597977/delayed TW:Y9999 -1.61% , Singapore /zigman2/quotes/210597985/delayed SG:STI -1.72% , Malaysia /zigman2/quotes/210598052/delayed MY:FBMKLCI -0.35% and Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX -2.06% were mixed. Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO -1.73% fell 0.5%.
Among individual stocks, Rakuten /zigman2/quotes/201861450/delayed JP:4755 -2.52% and Inpex /zigman2/quotes/206689846/delayed JP:1605 -2.46% rose in Tokyo trading. Casino operator Galaxy Entertainment /zigman2/quotes/202884203/delayed HK:27 -6.77% and Apple component maker Sunny Optical /zigman2/quotes/206687505/delayed HK:2382 -3.29% fell in Hong Kong. SK Hynix /zigman2/quotes/206420319/delayed KR:000660 -1.70% slipped in South Korea while Foxconn /zigman2/quotes/204111604/delayed TW:2354 -2.25% sank in Taiwan. BHP /zigman2/quotes/201448516/delayed AU:BHP -1.53% gained in Australia while Virgin Australia dipped.
Beijing wants 15% tariffs imposed in September on $125 billion of Chinese imports removed as part of a “Phase 1” deal in talks aimed at ending a trade war that threatens global growth, according to news reports. There was no sign whether President Donald Trump would agree, which raised the possibility of a new breakdown in negotiations.
“We see it fit to temper optimism for now,” said Vishnu Varathan of Mizuho Bank in a report.
On Wall Street, the Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -2.53% and the Nasdaq /zigman2/quotes/210598365/realtime COMP -2.23% closed at record highs Tuesday. The S&P 500 index /zigman2/quotes/210599714/realtime SPX -2.27% closed just below the all-time high reached the previous day.
Gains have been driven by better-than-expected company earnings, interest rate cuts, hopes for a trade truce and a steadily growing economy.
The upbeat mood marks a pivot from the summer, when worries about trade, Britain’s potentially messy exit from the European Union and the slowing global economy loomed over the market.
China’s central bank helped ease worries about a possible liquidity crunch by cutting its base interest rate on a one-year loan by 0.05% to 3.25%.
Analysts said the People’s Bank of China was fill demands for credit while keeping financial system risks under control.
“This is a small step towards future policy rate cuts, and it also signals that China’s central bank will finally start to follow other central banks in lowering its policy rate,” Citigroup economists said in a report.
Benchmark U.S. crude lost 31 cents to $56.92 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 69 cents on Tuesday to close at $57.23. Brent crude , used to price international oils, declined 37 cents to $62.59 per barrel in London. It gained 83 cents the previous session to close at $62.96.
The dollar /zigman2/quotes/210561789/realtime/sampled USDJPY -1.7336% declined to 109.03 yen from Tuesday’s 109.16.