Equity markets in Asia on Friday traded mixed as trade tensions resurfaced.
Shares edged lower in Australia and Japan, were little changed in Hong Kong and China, and ticked higher in South Korea.
Worries over trade tensions resurfaced after US President Donald Trump tweeted on Thursday China was not living up to promises it made on buying agricultural products from US farmers.
Yields on 10-year US Treasuries remained near a one-month high. Australian bonds tracked the slide in US debt.
Amid fears of global slowdown and growing trade protectionism, US Federal Reserve Chairman Jerome Powell said that a rate cut is likely at the central bank’s next meeting.
“The Trump tweet, combined with better-than-expected US inflation and labor data, gave good reason for equities traders to close up shop for the day,” Oanda Corp senior market analyst Edward Moya wrote in a note.
“Powell’s testimony on Thursday was mostly a reiteration and we could be in store for lackluster moves heading into Asia,” Moya wrote.
While the risk-asset rally got a fresh boost on the back of dovish comments from Powell, a strong consumer price index print offered a potential complication to US policymakers prior to its decision at the end of the month.
Traders pulled back bets on a half-point cut this month after the inflation data.
Hong Kong stocks were little changed on Friday, as investors digested a slew of Chinese economic data released toward the end of the session to assess health of the country’s economy.
Renewed worries over the trade tensions offset optimism fueled by Wall Street’s fresh highs overnight.
The MSCI Asia-Pacific index was virtually unchanged at 160.33, down 0.8 percent for the week.
The Hang Seng index on Friday rose 0.1 percent, to 28,471.62, while the China Enterprises Index was unchanged at 10,788.34.
China’s trade surplus with the US, a major source of friction with its biggest trading partner, last month rose to US$29.92 billion from US$26.9 billion in May, according to customs data released minutes before the closing bell.
Newly released data also showed that China’s imports of iron ore, crude, coal, copper and soybeans fell from a month earlier.
The sub-index of the Hang Seng tracking energy shares dipped 0.1 percent, while the IT sector fell 0.63 percent, the financial sector ended 0.55 percent higher and the property sector rose 0.37 percent.
Japan’s TOPIX fell 0.2 percent, while South Korea’s KOSPI rose 0.3 percent.
Australia’s S&P/ASX 200 Index fell 0.3 percent.
The weighted index on the Taiwan Stock Exchange ended down 19.07 points, or 0.18 percent, at 10,824.35, up 0.4 percent from last week’s 10,785.73 points.
Additional reporting by CNA and staff writer
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