Asian stocks tracked U.S. shares lower as investors looked for details of a possible trade deal between the U.S. and China. The dollar edged higher and Treasury yields held declines.
Equities fell in Japan, Korea, Australia and Hong Kong after the S&P 500 Index declined the most in a month, though the benchmark did pare the worst of its losses late in the session. Chinese stocks fluctuated and the yuan drifted after the country lowered its goal for economic growth and announced a major tax cut. The yen slipped.
After stocks on Monday were buoyed by news that the world’s two-largest economies were close to a trade deal that could lift most or all U.S. tariffs, investors are now hungry for concrete details before they push a global equities rally further. That’s especially more urgent amid growing evidence that the trade wars are hitting the U.S. economy.
Meanwhile, China lowered its official goal for economic growth in 2019 to a range of 6 to 6.5 percent, as policymakers seek to pull off a gradual deceleration while grappling with a debt legacy and the U.S. standoff. The country also announced a cut of 3 percentage points to the top bracket of value added tax in a move aimed at benefiting the manufacturing sector.
Elsewhere, West Texas Intermediate crude oil ticked lower though remained above the $56 a barrel level.
Here are some key events coming up:
- China’s National People’s Congress opens in Beijing on Tuesday. Premier Li Keqiang will announce an economic growth target. The Chinese People’s Political Consultative Conference runs concurrently. Through March 15.
- Australia’s central bank sets policy on Tuesday, then Governor Philip Lowe will give a speech on the housing market Wednesday.
- Bank of Canada Governor Stephen Poloz is expected to keep rates on hold Wednesday due to lingering uncertainty on housing and investment, while sticking to his message that borrowing costs eventually need to head higher.
- European Central Bank policy makers are expected to leave rates unchanged amid a deteriorating outlook. President Mario Draghi will hold a news conference on Thursday after the decision.
- The U.S. jobs report Friday may show hiring moderated in February. Nonfarm payrolls may have increased by 185,000 while the jobless rate fell to 3.9 percent, according to estimates.
These are the latest moves in markets:
Stocks
- The MSCI Asia Pacific Index fell 0.4 percent as of 10:35 a.m. in Tokyo.
- Japan’s Topix index fell 0.5 percent.
- S&P/ASX 200 Index fell 0.6 percent.
- Hong Kong’s Hang Seng Index fell 0.5 percent.
- Shanghai Composite Index was little changed.
- S&P 500 futures fell 0.1 percent. The S&P 500 lost 0.4 percent at the close in New York.
Currencies
- The Japanese yen fell 0.1 percent to 111.90 per dollar.
- The offshore yuan was little changed at 6.7091 per dollar.
- Bloomberg Dollar Spot Index rose 0.1 percent.
- The euro was stable at $1.1335.
- The British pound fell 0.1 percent to $1.3172.
Bonds
- The yield on 10-year Treasuries was little changed at 2.72 percent.
- Australia’s 10-year bond yield fell two basis points to 2.17 percent.
Commodities
- West Texas Intermediate crude fell 0.2 percent to $56.47 a barrel.
- Gold was little changed at $1,286.22 an ounce.
Source: Bloomberg