Asian markets retreated in early trading Friday, as the G-20 summit kicked off in Japan.
President Donald Trump met with the leaders of Japan, Germany and India on the sidelines of the G-20 meeting in Osaka, Japan, and said he was optimistic about making trade deals with all three of those countries. Trump was scheduled to meet with Russia’s Vladimir Putin later in the day, and with China’s Xi Jinping on Saturday, and hopes are high that the meeting with Xi will produce a cease-fire in the trade war.
But analysts caution any new truce at the Group of 20 meeting of major economies in Japan is likely to be temporary because negotiators face the same disagreements that caused talks to break down in May.
“We have watched this movie before: China and the U.S. talk, leaks from policymakers on both sides encourage speculation we are close to a deal, things fall apart,” said Hannah Anderson of J.P. Morgan Asset Management in a report.
Japan’s Nikkei NIK, -0.40% slipped 0.5% and Hong Kong’s Hang Seng Index HSI, -0.56% fell 0.6%. The Shanghai Composite SHCOMP, -0.88% dropped 0.9% and the smaller-cap Shenzhen Composite 399106, -1.15% slid 1.2%. South Korea’s Kospi 180721, -0.14% declined 0.2%, and benchmark indexes in Taiwan Y9999, -0.35% , Singapore STI, -0.13% and Indonesia JAKIDX, -0.01% were mixed. Australia’s S&P/ASX 200 XJO, -0.44% fell 0.2%.
Among individual stocks, beer maker Sapporo Holdings 2501, +1.70% gained in Tokyo trading, while Japan Steel 5631, -1.20% and Chiba Bank 8331, -2.05% fell. In Hong Kong, food processor WH Group 288, -2.81% sank, as did oil producer CNOOC 883, -1.49% and casino operator Sands China 1928, -0.93% . Chip maker SK Hynix 000660, -0.85% fell in South Korea, and BHP BHP, -1.86% and Rio Tinto RIO, -2.32% dropped in Australia.
On Wall Street, S&P 500 index SPX, +0.38% rose 0.4% to 2,924.92. The Dow Jones Industrial Average DJIA, -0.04% slipped less than 0.1% to 26,526.58 and the Nasdaq composite COMP, +0.73% gained 0.7% to 7,967.76.
This weekend marks the first face-to-face meeting between Trump and Xi since the American president said he was preparing to target the $300 billion in Chinese imports that he hasn’t already hit with tariffs, extending them to everything China ships to the United States.
The two sides are in a stalemate after 11 rounds of talks that failed to overcome U.S. concerns over China’s acquisition of American technology and its massive trade surplus. China denies forcing U.S. companies to hand over trade secrets and says the surplus is much smaller than it appears once the trade in services and the value extracted by U.S. companies are taken into account.
Despite worries over trade, investors have mostly pushed stocks higher this month as the Federal Reserve raised expectations that it is prepared to cut interest rates if needed to shield the economy should the damage from the costly trade conflict worsen.
Benchmark U.S. crude CLQ19, -0.49% fell 37 cents to $59.06 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 5 cents on Thursday to close at $59.43. Brent crude BRNQ19, -0.44% , used to price international oils, shed 39 cents to $65.28. The contract lost 2 cents the previous session to $65.67.
The dollar USDJPY, -0.16% declined to 107.59 yen from Thursday’s 107.79 yen.
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