SYDNEY / HONG KONG (Reuters) – Asian stocks held tight on Monday as worries about heated tensions between the United States and China weighed on sentiment, despite signs of a recovery in industrial activity in the world’s second-largest economy. covered.
PHOTO PHOTOS: A pedestrian wearing a face mask walks near an overpass with an electronic board showing stock information following a coronavirus outbreak (COVID-19) in Lujiazui Financial District in Shanghai, China March 17, 2020. REUTERS / Aly songs
European markets decided to open in positive territory, with the future EUROSTOXX 50 STXEc1 increased 0.77% and the future of FTSE FFIc1 increased 0.71%, while the future E-mini for the S&P 500 ESc1 index increased 0.19%.
The broader MSCI Asia-Pacific stock index outside Japan .MIAPJ0000PUS hovers between red and green, staying below a 6-1 / 2 month high affected last week. Japanese and Singaporean markets closed for public holidays.
Investors were in the spotlight after US President Donald Trump signed two executive orders banning WeChat, owned by Chinese tech giant Tencent (0700.HK), and TikTok in 45 days while announcing sanctions against 11 Chinese and Hong Kong officials.
Rounding out actions, U.S. regulators recommended that foreign firms listed on U.S. exchanges be subject to U.S. public audit reviews by 2022.
“The biggest question for the markets is whether these actions jeopardize the US-China trade talks on August 15 and the markets will closely seek any Chinese revenge,” said Tapas Strickland, director of markets and economics at the National Bank of Australia.
“The current assumption in the markets has been that President Trump needed an agreement phase to succeed, as much as China, this side of the November election … At the same time, President Trump is leading a difficult line in China in the election, “Strickland added.
CSI300 .CSI300 was a shadow and Hong Kong Hang Seng index .HSI fell 0.36% after the arrest of a Hong Kong media mogul with a new national security law.
While the deterioration of Sino-US relations depended heavily on sentiment, data showing a slowdown in China’s factory deflation raised hopes for economic recovery in the world’s second-largest economy.
China’s industrial output is steadily returning to watch levels before the pandemic paralyzes much of the economy, as demand for growth, government stimulus and surprisingly resilient exports push for a recovery.
Australian stocks increased the trend to 1.68% while the KOSPI index of South Korea .KS11 increased 1.38%. The New Zealand Comparison Index advanced 0.3%.
In currency, the dollar JPY = fell against the safe-haven yen at 105.79 while risk-sensitive AUD = D3 fed its losses after falling 1.1% on Friday. [FRX]
British Pound GBP = rose slightly to $ 1.3073, but was still below the five-month high of $ 1.3185 affected last week. The euro was mostly flat at $ 1.1789, after reaching its highest level since May 2018 last week.
This left the dollar = USD index at 93.35, having struggled on a slippery slope since late June.
The weight of the green result is uncertainty about the U.S. fiscal stimulus 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 benefits, less than $ 600 a week previously spent in crisis.
While analysts see the move as a cost-cutting move that leaves homeowners and tenants vulnerable to eviction, they are still optimistic about the prospects for more stimulus.
“I see this as another step in the negotiations than a break in the negotiations, with a timeline still unknown,” JPMorgan analyst Andrew Tyler wrote in a note.
“If we see the White House thinking that they no longer want to negotiate until after the election, then you think we will see a wave of declining GDP, followed by lower spending and unemployment points in September. until the end of the year”.
In commodities, gold XAU = slipped slightly to $ 2,029.20 an ounce after hitting an all-time high of $ 2,072.5 last week.
Oil prices were higher with Brent crude LCOc1 rising 43 cents to $ 44.83 a barrel. US crude level CLc1 added 54 cents to $ 41.76.
Edited by Sam Holmes and Lincoln Feast