Most Asian markets see further losses as trade row rumbles along

Global Stocks rally on strong jobs data

May 24, 2019: The increasingly fractious trade row between China and the United States was the main focus of Asian investor angst Friday, with most markets down to extend the previous day's steep losses, though oil edged back from a painful sell-off.

With little hope for a quick turnaround in the standoff the economic superpowers appear to be digging in their heels as they exchange barbs, blaming each other for the breakdown in tariff negotiations while the Huawei crisis shows no sign of letting up.

On top of that, investors have been spooked by weak economic data in Europe and the United States that reinforced concerns about a global slowdown, with the IMF warning the trade standoff will “jeopardise” 2019 growth.

“The trade war is going to cause growth to slow, both in the US and China, and therefore globally — there is no doubt about that,” Komal Sri-Kumar, founder of Sri-Kumar Global Strategies, told Bloomberg TV.

“The trade war is taking on new dimensions.”

Having taken a hammering Thursday — with energy and tech firms among the worst hit — Asian markets continued to struggle in early trade.

Shanghai slipped 0.2 percent, Tokyo went into the break 0.7 percent lower, Sydney lost 0.7 percent and Seoul fell 0.8 percent. Singapore and Wellington each dipped 0.3 percent and Manila dived 1.5 percent.

But Hong Kong rose 0.3 percent, Taipei added 0.2 percent and Jakarta edged up 0.1 percent.

The tepid performance followed a sharp drop on Wall Street, where all three main indexes lost more than one percent, with investors also spooked by an index of US manufacturing activity hitting a nine-year low in May.

And there are warnings about the outlook for equities as China and the United States continue to hit out at each other.

“China's stance on the talks has been clear — if the US wants to resume talks, they should show sincerity and correct their wrong practices,” commerce ministry spokesman Gao Feng said Thursday.

(APP)

Posted on: 2019-05-24T09:31:00+05:00

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