SYDNEY / HONG KONG (Reuters) – Asian stocks were in range on Monday as worries over escalating tensions between the United States and China weighed in, although signs of a resumption of industrial activity in the world’s second-largest economy limited losses.
PHOTO: A pedestrian wearing a face mask walks near an overpass with an electronic board showing stock information after a coronavirus disease outbreak (COVID-19) in the Lujiazui financial district of Shanghai, China, March 17, 2020. REUTERS / Aly song
European markets had to open in positive territory, with EUROSTOXX 50 STXEc1 futures up 0.77% and FTSE FFIc1 up 0.71%, while Ec mini futures for the S&P 500 ESc1 index up 0.19%.
The broadest MSCI index of the Asia-Pacific share outside Japan. MIAPJ0000PUS sees a saw between red and green, staying below the 6-1 / 2-month peak touched last week. Japanese and Singaporean markets were closed for public holidays.
Investors were cautious after US President Donald Trump signed two executive orders banning WeChat, owned by Chinese technology giant Tencent (0700.HK) and TikTok after 45 days, while announcing sanctions against 11 Chinese and Hong Kong officials.
Rounding off the action, US regulators have recommended that overseas companies listed on US stock exchanges be subject to a 2022 US public audit.
“The bigger question for the markets is whether these actions jeopardize the US-China trade talks on August 15, and the markets will look closely for Chinese revenge,” said Tapas Strickland, director of markets and economics at the National Bank of Australia.
“The presumed assumption about the markets is that President Trump needed the phase to succeed as much as China, this country in the November election … At the same time, President Trump is pursuing a firm Chinese line toward the election,” Strickland added.
China’s CSI300 .CSI300 blue chip was a nuance, and Hong Kong’s Hang Seng .HSI index fell 0.36 percent after the arrest of a well-known Hong Kong media mogul under a new national security law.
While deteriorating Sino-US relations were strong, data showing a slowdown in factory deflation in China have boosted hopes for economic recovery in the world’s second-largest economy.
China’s industrial production is constantly returning to levels seen before the pandemic paralyzed huge economic positions, as demand for limited funds, government incentives and surprisingly sustainable exports led to a recovery.
Australian stocks blocked the upward trend by 1.68%, while the South Korean index KOSPI .KS11 jumped 1.38%. The New Zealand benchmark index advanced 0.3%.
In foreign currency, the JPY = fell against the Japanese yen in safe havens to 105.79, while the risk-sensitive Australian dollar AUD = D3 maintained its losses after falling 1.1% on Friday. [FRX]
The British pound GBP = rose slightly to $ 1.3073, but was still below the five-month high of $ 1.33185, touched last week. The euro was largely $ 1.1789 after reaching its highest level since May 2018 last week.
This left the dollar = USD index at 93.35, struggling on a slippery slope since late June.
Weighing the mistake is uncertainty about fiscal stimulus in the United States after President Trump signed a series of executive orders to extend unemployment benefits after talks with Congress broke down.
Orders would provide an additional $ 400 a week in unemployment payments, less than $ 600 a week earlier in the crisis.
While analysts see the move as a cost reduction that leaves homeowners and tenants vulnerable to evictions, they are still optimistic about the prospect of more incentives.
“I see this as another step in the negotiations, rather than ending the negotiations with a still unknown timeline,” JPMorgan analyst Andrew Tyler wrote in a note.
“If we see that the White House is of the opinion that they no longer want to negotiate until after the election, then we think we will see a wave of declining GDP, followed by lower spending and jumps to unemployment in September to the end of year. ”
In commodities, gold XAU = fell slightly to $ 2,029.20 an ounce after hitting a high of $ 2,072.5 last week.
Oil prices were higher when crude Brent LCOc1 rose 43 cents to $ 44.83 a barrel. The US crude CLc1 added 54 cents to $ 41.76.
Edited by Sam Holmes and Lincoln Fest