Asian stocks decline as 'warm fuzzy feeling' of US-China trade agreement fades
Stocks in Asia slipped Tuesday in morning trade amid uncertainty about the future of U.S.-China trade relations.
Japan’s Nikkei 225 declined by 0.14 percent in early trade while the Topix index shed 0.25 percent. Shares of automaker Nissan slipped 0.25 percent following a Reuters report that the company’s external board is set to meet today to discuss a replacement for arrested former Chairman Carlos Ghosn.
Meanwhile in South Korea, the Kospi slipped 0.21 percent.
Over in Australia, the ASX 200 recovered partially from early losses but still traded down by 0.16 percent in the morning, with almost all sectors in negative territory.
The heavily weighted financial subindex in Australia slipped 0.25 percent. Shares of the country’s so-called Big Four banks mostly saw losses: Australia and New Zealand Banking Group slipped 0.45 percent, Westpac fell 0.3 percent and National Australia Bank traded down by 0.12 percent. Commonwealth Bank of Australia, on the other hand, recovered from its earlier losses to trade largely flat.
The Reserve Bank of Australia is set to announce its policy decision on interest rates at 11:30 a.m. HK/SIN.
The mainland Chinese markets, which have been closely watched in relation to Beijing’s trade war with Washington, are set to open at 9:30 a.m. HK/SIN.
Overnight on Wall Street, the major indexes saw gains. The Dow Jones Industrial Average advanced 287.97 points to close at 25,826.43 while the S&P 500 rose 1.1 percent to finish the trading day at 2,790.37. The Nasdaq Composite rose 1.5 percent to close at 7,441.51.
The moves came after U.S. President Donald Trump and Chinese President Xi Jinping agreed to a 90-day postponement of any new tariffs in the trade war that has weighed heavily on global stock markets for most of 2018.
There have been differences, however, between the descriptions of the agreement from the White House, from Trump himself and from Beijing. Questions also remain over who would lead the U.S. delegation in future trade talks with Beijing.
In a morning note, Rodrigo Catril, a senior foreign exchange strategist at National Australia Bank, said the overnight trade news had “probably left the market with more questions than answers.”
“Can the US and China really resolve their differences in 90 days? It seems that more details and signs of progress will be needed if the initial trade truce warm fuzzy feeling is to be sustained,” Catril said.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 97.040 after touching lows around 96.7 earlier.
The Japanese yen was at 113.59 against the dollar after seeing highs around the 113.4 handle in the previous session. The Australian dollar traded at $0.7357 after touching highs at about $0.739 yesterday.
— CNBC’s Fred Imbert contributed to this report.