Asian Stocks Trade Mixed; Treasury Yields Decline: Markets Wrap

(Bloomberg) — Asian stocks were mixed Tuesday as investors awaited further developments on the U.S.-China trade front and kept an eye on the situation in Hong Kong. Treasuries recouped some of their recent losses.

Hong Kong shares stabilized after sharp losses on Monday, when escalating violence in the strife-torn city unnerved investors. Stocks dipped in Tokyo, Shanghai and Sydney, and ticked up in Seoul. U.S. futures slipped after the S&P 500 Index fell for the first time in four sessions in holiday-thinned trading on Monday. New Zealand’s dollar slumped after a weakening in inflation expectations spurred bets on a rate cut.

© Bloomberg Hong Kong’s stock rally looks strained as market became overbought

Investors are on the lookout for any headlines that could point to a first-phase trade deal between the U.S. and China after mixed messages from the White House and delayed meetings heightened concern the negotiations are stumbling.

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“Markets have been skittish,” said Matt Forester, chief investment officer at BNY Mellon’s Lockwood Advisors. “We will need more concrete information about the structure and timing of any kind of final trade arrangement, but in the meantime we are operating on scraps of information.”

Meantime, clashes in Hong Kong, where police shot a protester on Monday, have deepened concerns about the outlook for the Asian financial hub. Hong Kong Chief Executive Carrie Lam on Tuesday condemned the disruption to commutes.

Elsewhere, the pound held gains following a boost to Prime Minister Boris Johnson’s prospects of gaining a majority in next month’s election, care of a campaign-strategy shift by the Brexit Party.

Here are some key events coming up this week:

Earnings include Tencent, Nissan Motor, Japan Post Bank and Mitsubishi UFJ.New Zealand’s policy decision is due Wednesday, with market pricing tilting in favor of an interest-rate cut.Fed Chairman Jerome Powell addresses the Joint Economic Committee of Congress, in Washington Wednesday. Minneapolis Fed President Neel Kashkari speaks in La Crosse, Wisconsin.Thursday brings China retail sales and industrial production data.U.S. retail sales on Friday are forecast to rebound in October after unexpectedly falling the prior month.

These are the main moves in markets:

Stocks

Japan’s Topix index was down 0.2% as of the lunch break in Tokyo.Australia’s S&P/ASX 200 Index fell 0.5%.South Korea’s Kospi index rose 0.1%.Hong Kong’s Hang Seng Index dipped 0.2%.Shanghai Composite fell 0.3%.S&P 500 futures were down 0.2%. The S&P 500 Index fell 0.2%.

Currencies

The yen traded at 109.14 per dollar, little changed.The offshore yuan was steady at 7.0049 per dollar.The euro was at $1.1027.The British pound traded at $1.2855 after jumping 0.6% Monday.

Bonds

U.S. 10-year Treasury yield fell two basis points to 1.92%.Australia’s 10-year bond yield fell one basis point to 1.28%.

Commodities

West Texas Intermediate crude lost 0.3% to $56.71 a barrel.Gold traded at $1,455.59 an ounce.

To contact the reporter on this story: Andreea Papuc in Sydney at apapuc1@bloomberg.net

To contact the editor responsible for this story: Christopher Anstey at canstey@bloomberg.net

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