AFP, Hong Kong :
Asian markets were mixed Wednesday, with Shanghai and Hong Kong sharply lower following reports the US was planning to more than double planned tariffs on China.
The region started on a positive note, tracking a Wall Street lead on hopes China and the US would resume talks to resolve their deepening trade war. Healthy corporate earnings also provided support.
Bloomberg News reported that Washington and Beijing were looking to discuss the tariffs row that has fuelled fears of an all-out trade war between the world’s top two economies.
That came after Treasury Secretary Steven Mnuchin said last week that “some quiet conversations” had taken place, adding that the US was open to discussions “any time China is willing to seriously negotiate”.
However on Tuesday reports said the White House was considering raising to 25 percent from 10 percent its planned tariffs on $200 billion worth of Chinese goods.
Tariffs on $16 billion of Chinese imports are due in coming weeks, following measures on $34 billion worth of goods imposed in July, which prompted a response in kind by Beijing. Nick Griffin, chief investment officer at Munro Partners, told Bloomberg Television: “The tariff issue is ongoing, I think it’s a negotiating tactic.
“How much we take of this as real and affecting earnings is questionable at this stage.
In terms of an actual earnings effect, it’s not that big at the moment, it’s mainly just sentiment and risk appetite and for that it’s a
moving feast.”
Still, Shanghai tumbled 1.80 percent and Hong Kong lost 0.5 percent in the
afternoon, while Sydney slipped 0.1 percent. Wellington shed 0.7 percent.
But Tokyo ended 0.9 percent higher on a weaker yen, while Singapore added
0.3 percent and Seoul gained 0.5 percent. Taipei, Manila, Jakarta and Bangkok
were also up.
Suppliers to Apple performed well after the US giant announced better-
than-forecast profits. Foxconn climbed 1.7 percent in Taipei, Japan Display
rallied 1.4 percent in Tokyo and Seoul-listed LG Display was 1.9 percent
higher.
On currency markets the yen extended Tuesday’s drop after the Bank of
Japan tweaked monetary policy but held off on any major tightening measures,
while revising down inflation expectations.
Stephen Innes, head of Asia-Pacific trading at OANDA, said: “The BoJ
announced minuscule adjustments. Traders view incredibly subtle shift towards
policy normalisation as definitively dovish and topside (for the dollar) is
now in play.”
Oil prices also fell further after Trump’s Monday offer of talks with
Tehran to resolve the nuclear row. Crude has risen in recent months on fears
supplies would be cut off by the US decision to withdraw from an
international accord with Iran over its atomic programme and reimpose
sanctions.
Traders are also awaiting the release later in the day of a closely
watched US crude inventories report, seen as a barometer for supply and
demand in the world’s top oil-consuming nation.
In early trade London was flat, Paris rose 0.3 percent and Frankfurt added
0.1 percent.
Asian markets were mixed Wednesday, with Shanghai and Hong Kong sharply lower following reports the US was planning to more than double planned tariffs on China.
The region started on a positive note, tracking a Wall Street lead on hopes China and the US would resume talks to resolve their deepening trade war. Healthy corporate earnings also provided support.
Bloomberg News reported that Washington and Beijing were looking to discuss the tariffs row that has fuelled fears of an all-out trade war between the world’s top two economies.
That came after Treasury Secretary Steven Mnuchin said last week that “some quiet conversations” had taken place, adding that the US was open to discussions “any time China is willing to seriously negotiate”.
However on Tuesday reports said the White House was considering raising to 25 percent from 10 percent its planned tariffs on $200 billion worth of Chinese goods.
Tariffs on $16 billion of Chinese imports are due in coming weeks, following measures on $34 billion worth of goods imposed in July, which prompted a response in kind by Beijing. Nick Griffin, chief investment officer at Munro Partners, told Bloomberg Television: “The tariff issue is ongoing, I think it’s a negotiating tactic.
“How much we take of this as real and affecting earnings is questionable at this stage.
In terms of an actual earnings effect, it’s not that big at the moment, it’s mainly just sentiment and risk appetite and for that it’s a
moving feast.”
Still, Shanghai tumbled 1.80 percent and Hong Kong lost 0.5 percent in the
afternoon, while Sydney slipped 0.1 percent. Wellington shed 0.7 percent.
But Tokyo ended 0.9 percent higher on a weaker yen, while Singapore added
0.3 percent and Seoul gained 0.5 percent. Taipei, Manila, Jakarta and Bangkok
were also up.
Suppliers to Apple performed well after the US giant announced better-
than-forecast profits. Foxconn climbed 1.7 percent in Taipei, Japan Display
rallied 1.4 percent in Tokyo and Seoul-listed LG Display was 1.9 percent
higher.
On currency markets the yen extended Tuesday’s drop after the Bank of
Japan tweaked monetary policy but held off on any major tightening measures,
while revising down inflation expectations.
Stephen Innes, head of Asia-Pacific trading at OANDA, said: “The BoJ
announced minuscule adjustments. Traders view incredibly subtle shift towards
policy normalisation as definitively dovish and topside (for the dollar) is
now in play.”
Oil prices also fell further after Trump’s Monday offer of talks with
Tehran to resolve the nuclear row. Crude has risen in recent months on fears
supplies would be cut off by the US decision to withdraw from an
international accord with Iran over its atomic programme and reimpose
sanctions.
Traders are also awaiting the release later in the day of a closely
watched US crude inventories report, seen as a barometer for supply and
demand in the world’s top oil-consuming nation.
In early trade London was flat, Paris rose 0.3 percent and Frankfurt added
0.1 percent.
