Published: Sun, June 17, 2018
Finance | By Gustavo Carr

Asian shares shaky as US readies China tariffs

Asian shares shaky as US readies China tariffs

The USD/JPY pair are trading at 110.48 Yen, down 0.17%; the pair earlier hit a peak of 110.690 Yen while the low is at 110.457 Yen.

The Trump administration is set to release its final list of Chinese products that will be subject to 25% tariffs by Friday, with the US President reasserting vows to pursue aggressive trade action in the coming weeks against China.

Beijing said it's ready to respond.

It is not clear when President Trump will activate the measures, but rising Sino-US trade tensions will put more pressure on China's economy, which is starting to show signs of cooling after a multi-year crackdown on riskier lending.

Chinese stocks led the losses, with the benchmark Shanghai Composite index plumbing a 20-month low, as investors anxious about the economic damage from the trade tensions with the United State. Stocks in Taiwan and Southeast Asia were lower. But Japan's Nikkei average added 0.5 per cent.

The free trade agreement with Canada does not ensure sufficient protection for Italy's speciality foods, new Agriculture Minister Gian Marco Centinaio said in a newspaper interview. "This is likely to weigh on market sentiment over the summer".

The ECB said on Thursday it would end its hallmark bond purchase scheme by the close of the year but signalled that any interest rate hike is still distant.

The benchmark DAX was up 15 points or 0.11 percent at 13,122 in opening deals after climbing as much as 1.7 percent the previous day.

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Demand for the 10-year German Bund sent its yield 6 basis points lower to 0.43 per cent.

The pan-European STOXX 600 index rose 0.2 per cent by 0710 GMT, up 2.2 per cent on the week, as further falls in the euro pushed the euro zone index up 0.2 per cent to a three-week high.

Helping boost United States equities was a Commerce Department report showing retail sales rose more than expected in May, the latest indication of an acceleration in economic growth in the second quarter.

With sizeable stock of acquired assets, worth 2.4 trillion euros as of May, together with reinvestments of the principal payments from maturing securities purchased after the end of asset purchase program, as well as forward guidance on interest rates, the European Central Bank intends to ensure the ample degree of monetary easing for an extended period of time.

Though full policy normalisation will take years, investors are already braced for the end of easy money from the world's central banks.

Oil prices were little changed as investors eyed a key Opec meeting in Vienna.

The chances are that Saudi Arabia and Russian Federation will push for agreement to lift output ceilings to offset production shortfalls in Venezuela and Iran.

West Texas Intermediate (WTI) crude oil futures were up 0.2 per cent at US$67.02 per barrel, while Brent was at US$76.02.

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