TOKYO, May 15 — Asian stocks struggled near a 3-1/2-month low today on lingering concerns over the economic impact of a US-China trade war, although an overnight bounce on Wall Street helped limit the losses.
MSCI's broadest index of Asia-Pacific shares outside Japan edged down 0.05 per cent.
The index had fallen to its lowest level since the end of January the previous day as a trade conflict between the United States and China intensified. Beijing on Monday imposed a tariff hike on US goods following Washington's decision last week to hike its levies on Chinese imports.
Australian stocks added 0.07 per cent, South Korea's Kospi slipped 0.1 per cent and Japan's Nikkei shed 0.4 per cent.
US stocks yesterday reclaimed some of the ground lost in the prior day's steep selloff, with tariff-sensitive technology stocks heartened by a slight softening in US-China trade rhetoric.
US President Donald Trump yesterday said he had a “very good” dialogue with China and insisted talks between the world's two largest economies had not collapsed.
Yet, investors braced for a protracted US-China trade war.
“In the short term the equity markets have begun digesting the latest round of the trade war,” said Soichiro Monji, senior strategist at Sumitomo Mitsui DS Asset Management, adding that a bit of calm is returning to some markets as a result.
“Still, the US-China row looks to continue in the coming months. China did not seem to present a totally unified front in the latest round of the trade spat and its reaction bears watching going forward.”
On the day, investors will look to a batch of Chinese economic data due later for a further gauge of the health of the world's second-biggest economy.
The Chinese yuan stood little changed at 6.9051 per US dollar in offshore trade, having edged away from a five-month trough of 6.9200 set yesterday.
The US dollar traded a shade higher at 109.675 yen, pulling away from a three-month low of 109.020 plumbed on Monday when trade war worries boosted investor demand for the safe-haven Japanese currency.
The euro was steady at US$1.1202. The common currency had dipped nearly 0.2 per cent the previous day after Italy's deputy prime minister said the country is ready to break European Union budget rules on debt levels if necessary to spur employment.
The US dollar index against a basket of six major currencies was nearly flat at 97.534 after gaining 0.2 per cent the previous day.
In commodities, US crude futures were down 1.04 per cent at US$61.14 (RM254.81) per barrel after the American Petroleum Institute (API) reported a bigger-than-expected build in crude oil inventory.
US crude inventories rose by 8.6 million barrels in the week to May 10 to 477.8 million, compared with analysts' expectations for a decrease of 800,000 barrels.
Brent crude lost 0.69 per cent to US$70.75 per barrel.
Brent and US crude futures had surged the previous day after top exporter Saudi Arabia said explosive-laden drones launched by a Yemeni-armed movement aligned to Iran had attacked facilities belonging to state oil company Aramco. — Reuters
