Asian shares struggle as trade fears keep investors cautious

By Hideyuki Sano TOKYO (Reuters) - Asian stocks struggled to gain traction on Friday, following a mixed end to Wall Street trade and as the worsening Sino-U.S. trade dispute kept investors in the region cautious, despite signs of rapprochement between the United States and Europe

Reuters July 27, 2018 07:05:06 IST
Asian shares struggle as trade fears keep investors cautious

Asian shares struggle as trade fears keep investors cautious

By Hideyuki Sano

TOKYO (Reuters) - Asian stocks struggled to gain traction on Friday, following a mixed end to Wall Street trade and as the worsening Sino-U.S. trade dispute kept investors in the region cautious, despite signs of rapprochement between the United States and Europe.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> was little changed in early trade.

Japan's Nikkei <.N225> eked out a 0.3 percent gain though it was capped by worries that the Bank of Japan could scale down its asset purchase at its upcoming policy review next week.

MSCI's gauge of stocks across the globe <.MIWD00000PUS> hit four-month highs on Thursday, with European car maker shares <.SXAP> gaining 2.6 percent after the European Union and the United States agreed to negotiate on trade, easing fears of a transatlantic trade war.

U.S. industrial shares <.SPLRCI> also made gains, rising 0.8 percent though the S&P 500 Index <.SPX> dipped 0.30 percent on Thursday, due to a 19 percent dive in Facebook on its earnings showing slowing usage.

While that pushed down the Nasdaq Composite <.IXIC> 1.01 percent, other U.S. tech firms held firm, with Amazon.com shares gaining 3.2 percent after market following its stellar earnings.

The 10-year U.S. Treasuries yield edged up to 2.9840 percent, its highest level in 1-1/2 months, on receding worries about trade tensions.

Yet Asian shares were more subdued as trade disputes between Washington and Beijing have shown few signs of abating.

"Now that Washington does not need to use its energy to fight with Europe, it could increase pressure on China," said Nobuhiko Kuramochi, chief strategist at Mizuho Securities.

The Chinese yuan stayed near its 13-month low touched earlier this week.

The offshore yuan traded at 6.8283 per dollar , near Tuesday's low of 6.8448.

The Thomson Reuters/HKEX Global CNH index <.RXYH>, which tracks the offshore yuan against a basket of currencies on a daily basis, fell to its lowest levels since May last year, having fallen 2.7 percent so far this month.

The euro traded at $1.1641 , having fallen 0.73 percent on Thursday after the European Central Bank signalled no change in its timetable to move away from ultra low rates or end its bond purchase program.

The dollar ticked up to 111.22 yen after hitting a low of 110.58 yen the previous day, its lowest level in more than half a month, in part helped by a rise in U.S. yields.

In commodities, oil prices extended their recovery, after Saudi Arabia suspended oil shipments through a strait in the Red Sea following an attack on two oil tankers.

Brent crude futures traded at $74.45 per barrel, down 0.1 percent, though they were up 1.9 percent so far this week.

(Editing by Sam Holmes)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.