Asian stocks fall and investors seek haven assets
Shares in Asia fell today as investors seek more relatively safer assets while persistent trade tensions between the world’s two most powerful economic powers escalate.
Australia’s S&P/ASX 200 slid by 0.7 per cent, Japan’s Topix index was down 1 per cent, South Korea’s Kospi stumbled 1.2 per cent in the afternoon’s trading session. Hong Kong’s Hang Seng and China’s CSI 300 both dropped 0.3 per cent.
The bourses took their cues from Wall Street, where the S&P 500 ended Tuesday down 0.8 per cent, erasing gains earlier in the session.
Trade tensions of the world’s top two economies demonstrate little evidence of calming down. China’s powerful planning body threatened on Tuesday to use rare earth metal exports as leverage in the dispute. This was a response to Donald Trump as he announced that the US is not ready to reach a deal with China in Tokyo.
Investors rather opted for safety in Treasuries, with yields on US 10-year sovereign bond sliding further to their lowest level since September 2017. As prices rise bond yields tend to fall.
S&P 500 futures are pointing to losses of 0.3 per cent when the Wall Street benchmark opens later on Wednesday.