Home >Markets >Stock Markets >Asian stocks edge lower; US equity rally fizzles

Asian stocks opened modestly lower after a rally in U.S. equities fizzled on fresh U.S.-China tensions. The dollar held losses.

Sentiment is being tested as global equities round out a second month of gains, with President Donald Trump saying he’ll announce new U.S. steps on China on Friday, after it passed a national security law curbing freedoms in Hong Kong. Japanese shares dipped modestly along with those in Seoul and Sydney. U.S. contracts slid after the gauge gave up a gain of more than 1%, with the announcement stoking concern Sino-American tensions will disrupt the economic reopening narrative that’s propelled markets. Treasuries were steady.

The escalation in hostilities between Washington and Beijing is capping positive sentiment as traders weigh indications of economies healing after lockdowns. U.S. states’ jobless rolls shrank for the first time during the outbreak even as millions more Americans filed for unemployment benefits, while readings on durable goods orders and personal consumption beat forecasts.

Meantime, clues on the next stages for Federal Reserve policy may come later Friday, when Chairman Jerome Powell participates in a virtual discussion.

The daily fixing of China’s exchange rate will be in focus again Friday. The offshore yuan steadied near a record low after China signaled with a stronger-than-expected fixing on Thursday that it wants to avoid rapid depreciation.

Elsewhere, crude oil dipped after gaining Thursday. European stocks ended higher amid optimism over economies reopening and a European Union fiscal stimulus plan.

Here are some key events coming up:

  • Euro-area data due Friday is forecast to show consumer inflation fell to 0.1% in May from 0.4% the previous month.

These are some of the main moves in markets:

Stocks

  • S&P 500 futures fell 0.4% as of 9:05 a.m. in Tokyo. The S&P 500 fell 0.2% Thursday.
  • Japan’s Topix index fell 0.6%.
  • South Korea’s Kospi declined 0.4%.
  • Australia’s S&P/ASX 200 Index slid 0.3%.

Currencies

  • The yen was little changed at 107.61 per dollar.
  • The offshore yuan was flat at 7.1715 per dollar.
  • The euro bought $1.1074, little changed.

Bonds

  • The yield on 10-year Treasuries dipped one basis point to 0.68%.
  • Australia’s 10-year yield remained at 0.88%.

Commodities

  • West Texas Intermediate crude fell 0.7% to $33.48 a barrel.
  • Gold rose 0.2% to $1,721.91 an ounce.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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