Asian Shares Retreat On US-China Trade Deal Doubts

(RTTNews) - Asian stocks fell on Wednesday as hopes over a concrete U.S.-China trade deal faded and focus shifted to central bank meetings.

The Federal Reserve is widely expected to cut interest rates by 25 basis points at the end of a two-day policy meeting later today while the Bank of Japan's policy decision on Thursday, is likely to be a close call on whether to unleash more stimulus or hold fire for now.

Chinese shares fell on doubts over the prospects of a first-phase of the Sino-U.S. trade deal. The benchmark Shanghai Composite index shed 14.86 points, or 0.50 percent, to end at 2,939.32, while Hong Kong's Hang Seng index ended down 0.44 percent at 26,667.71.

Japanese shares retreated as investors awaited the Fed's monetary policy decision later today and the Bank of Japan's policy announcement due on Thursday. The Nikkei average dropped 131.01 points, or 0.57 percent, to 22,843.12 after reaching its highest level in more than a year the previous day. The broader Topix index closed 0.19 percent higher at 1,665.90.

Exporters ended broadly lower as the yen rose slightly after the release of robust retails sales data showing that retail sales in Japan climbed an annual 9.1 percent in September following the 1.8 percent gain in August. Honda Motor, Panasonic and Sony edged lower while Canon rallied 2.1 percent. Market heavyweight Fast Retailing gave up 2.2 percent.

Australian markets ended notably lower to snap a seven-session winning streak. The benchmark S&P/ASX 200 index dropped 55.90 points, or 0.83 percent, to 6,689.50 while the broader All Ordinaries index ended down 53.80 points, or 0.79 percent, at 6,794.70.

Mining stocks suffered heavy losses after the World Bank downgraded outlook for energy and metal commodities prices, citing rising inventories and lower demand from China. Heavyweights BHP and Rio Tinto fell over 1 percent while smaller rival Fortescue Metals Group lost 1.9 percent.

Evolution Mining advanced 1.5 percent as gold prices firmed up on reports of a possible delay in U.S.-China trade deal. Banks ANZ and Commonwealth declined around 1 percent each.

Genworth Mortgage Insurance Australia shares soared 10.6 percent after the company posted a 30 percent rise in Q2 underlying net profit, citing improved conditions in the Australian property market. Property developer Stockland Corp gained 1 percent.

Woolworths Group lost 1.4 percent. The supermarket giant said its review found it owes 5,700 staff about A$300 million in underpaid wages dating back over nine years.

Afterpay Touch Group tumbled 3 percent on news it has expanded its presence in the UK's buy now, pay later market by signing a deal with clothing and food retailer Marks and Spencer.

On the economic front, a government report showed that consumer prices in Australia were up 1.7 percent year-on-year in the third quarter of 2019, in line with expectations and up from 1.6 percent in the previous three months.

Seoul stocks slipped into the red as investors fretted about a possible delay in U.S.-China trade deal and awaited the Fed's interest-rate decision. The Kospi average ended down 12.42 points, or 0.59 percent, at 2,080.27.

New Zealand shares ended little changed with a negative bias ahead of the Fed decision. Shares of market operator NZX soared 4 percent.

U.S. stocks ended lower overnight after reports suggested a phase one trade deal between the U.S. and China may not be signed by a summit in Chile next month.

The Dow Jones Industrial Average and the S&P 500 edged down around 0.1 percent while the tech-heavy Nasdaq Composite shed 0.6 percent.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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