Welcome to Business Outlook
Related Articles
Asia markets were mostly down Monday,
with investors cautious ahead of US-China talks in Shanghai this week and
amid more civil unrest in Hong Kong.
Two-day discussions begin on Tuesday with a Washington delegation led by
White House Trade Representative Robert Lighthizer.
But analysts are pessimistic about a resolution to the year-long trade
dispute between the world’s top two economies that has seen $360 billion in
tariffs imposed on bilateral trade.
“Hoping for the best but preparing for the worst best describes my view,”
said Vanguard Markets managing partner Stephen Innes. “We are not overly
optimistic about a positive Shanghai surprise.”
Hong Kong was among the biggest downward movers on Tuesday with the Hang
Seng Index falling 1.2 percent, after a fresh round of violent protests in
the financial hub.
Pro-democracy protesters in the financial hub fought a second consecutive
day of running battles with police on Sunday evening in a well-heeled
residential district, a day after clashes at a banned rally in a town near
the border with mainland China.
China’s top policy body on Hong Kong affairs was set to hold an extremely
rare press briefing on Monday afternoon on the crisis engulfing the financial
hub.
The weekend protests were “factoring quite negatively into the overall
risk equation, Innes said, with traders concerned that Washington may speak
in support of the demonstrators.
“If they do, it would not only throw this week’s trade discussion into
disarray but could jeopardise bilateral trade negotiations going forward,” he
added.
Seoul was down 1.9 percent amid an ongoing trade spat with Tokyo, which
restricted export of materials key to South Korean tech firms earlier this
month.
Elsewhere the Nikkei was down 0.6 percent at the lunch break while
Shanghai was 0.2 percent lower.
– Rate cut expectations –
Oil benchmarks were slightly down Monday after ending last week higher on
strong US growth figures, and amid continuing tensions over Britain’s seizure
of an Iranian oil tanker earlier this month.
Expectations of a Fed rate cut have been priced into the market and could
see downward pressure on the gold price, said OANDA senior market analyst
Alfonso Esparza.
“A 25 basis points cut by the Fed following a more cautious approach could
lead to downward pressure for the yellow metal, with the $1,400 level under
threat,” he added.
– Key figures around 0300 GMT –
Tokyo – Nikkei 225: DOWN 0.6 percent at 21,538.20
Hong Kong – Hang Seng: DOWN 1.2 percent at 28,065.74
Shanghai – Composite: DOWN 0.2 percent at 2938.13
Pound/dollar: DOWN at $1.2371 from $1.2383
Euro/pound: UP at 89.99 pence from 89.86 pence
Euro/dollar: UP at $1.1132 from $1.1128
Dollar/yen: DOWN at 108.66 yen from 108.66 yen
Brent North Sea crude: DOWN 23 cents at $63.23 per barrel
West Texas Intermediate: DOWN 13 cents at $56.07 per barrel
New York – Dow: UP 0.2 percent at 27,192.45 (close)
London – FTSE 100: UP 0.8 percent at 7,549.06 (close)
(BSS)
