Asia report: Markets mixed as US and China meet for trade talks
Markets in Asia finished the day mixed on Thursday, as investors digested the latest update from the Federal Reserve in the US, and kept one eye on the start of trade talks between the US and China.
Markets in Japan were closed for Constitution Memorial Day, as the yen strengthened 0.533% against the dollar to last trade at JPY 109.26.
On the mainland, the Shanghai Composite added 0.65% to 3,101.13, and the smaller, technology-heavy Shenzhen Composite rose 1.01% to 1,792.89.
South Korea’s Kospi was down 0.73% at 2,487.25, while the Hang Seng Index in Hong Kong slid 1.34% to 30,313.37.
Banks and technology plays led the losses in Seoul, while technology names managed small gains.
In Hong Kong, Chinese smartphone giant Xiaomi filed an initial public offering, reporting in its documents that its revenue was up 68% to CNY 114.5bn in 2017.
It still recorded a net loss of CNY 43.9bn.
Trade was very much at the top of the agenda for market watchers, as a delegation from Washington began negotiations with Chinese counterparts in Beijing.
Among the American officials at the two-day meeting were Treasury secretary Steve Mnuchin, trade representative Robert Lighthizer and Commerce secretary Wilbur Ross.
“The mood music coming out isn't great,” noted ING Asia Pacific head of research Robert Carnell, adding: “as they continue to stress that they will return early if they do not think there is much promise of progress.”
Carnell said the meeting could move the market in either direction, adding that the most likely way was down.
Asia investors also digested the overnight decision from the Fed to keep US interest rate targets on hold, which was widely anticipated.
The central bank, however, did note that inflation was starting to creep higher towards its 2% target.
Oil prices were lower, with Brent crude last down 0.7% at $72.85 per barrel, and West Texas Intermediate off 0.31% at $67.72.
In Australia, the S&P/ASX 200 managed gains of 0.8% to 6,098.30, led higher by the gold and materials subindices.
National Australia Bank announced earlier in the session that its first-half cash profit was down 16%, as the bank booked costs associated with its restructure.
Its stock was down 0.64% in Sydney trading.
Across the Tasman Sea, New Zealand’s S&P/NZX 50 gained 0.6% to 8,546.88, led higher by fuel refiner and retailer Z Energy, which was ahead 2.9%.
The company, which is primarily formed of Royal Dutch Shell’s divested New Zealand assets, saw revenue surge 18% in the year to 31 March to NZD 4.57bn, with profit ahead 8% at NZD 263m.
Z Energy’s improved profits came as the New Zealand government pledged to look more closely at the way fuel retailers operate, after a leaked internal email from BP around its price-setting practices in rural areas was met with public furore.
Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.55% at AUD 1.3273 and the Kiwi advancing 0.62% to NZD 1.4207.