Asian Shares Slide Amid Geopolitical Tensions

Asian stocks were broadly lower on Tuesday and safe-haven assets such as the Japanese yen, gold and U.S. Treasuries ticked higher after North Korea conducted a missile launch over Japan for the first time since 2009.

After a 40-minute phone call with U.S. President Donald Trump, Japanese Prime Minister Shinzo Abe told reporters that he and Trump are in complete agreement to hike pressure on North Korea.

Investors were also reacting to a steep drop in oil prices overnight after Tropical Storm Harvey battered Houston and the wider Gulf Coast region.

Crude futures rose slightly in Asian deals after closing at their lowest level in about a month overnight on concerns that the refinery shutdowns due to Hurricane Harvey could trigger an increase in crude inventories.

Gold extended gains after having jumped more than 1 percent on Monday to reach an 11-month settlement high.

China’s Shanghai Composite was up 0.2 percent in cautious trade while Hong Kong’s Hang Seng index was down 0.4 percent at 27,747. New Zealand’s NZX-50 index was down as much as 0.8 percent at 7,764.

Japan’s Nikkei index was down about 120 points or 0.61 percent at 19,330 as the dollar hit a four-month low versus the yen. In early trade, the benchmark index hit as low as 19,304.76, its lowest level since May 1.

Australia’s benchmark S&P/ASX 200 was down 48 points or 0.87 percent at 5,660 as the country’s big banks extended Monday’s losses after the Australian Prudential Regulation Authority launched an independent inquiry into Common Wealth Bank.

South Korea’s Kospi average was down more than 1 percent at 2,343 as Samsung Electronics shares extended losses over the imprisonment of vice chairman Lee Jae-yong in relation to a corruption scandal.

U.S. stocks ended mixed overnight, with energy companies as well as property insurers and reinsurance companies coming under selling pressure as investors assessed losses from Hurricane Harvey.

The Dow edged down marginally, while the S&P 500 rose 0.1 percent and the Nasdaq Composite added 0.3 percent.

European markets fell on Monday after ECB President Mario Draghi held back from talking down the euro at the central bankers’ meeting and the third round of Brexit talks began in Brussels.

The pan-European Stoxx Europe 600 index shed half a percent. The German DAX dropped 0.4 percent, France’s CAC 40 index declined half a percent and the U.K.’s FTSE 100 slid 0.1 percent.

by RTT Staff Writer

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