Asia Pacific stocks edge up amid US-China trade jitters

Stocks in Asia Pacific edged up in Friday morning trade as a series of developments overnight on the U.S.-China trade front dampened hopes.

The Nikkei 225 in Japan rose 0.23% in early trade, with shares of index heavyweight and conglomerate Softbank Group jumping 1.32%. The Topix index also gained 0.18%.

Japan’s core consumer inflation slowed to a new two-year low in August, rising 0.5% in August from a year earlier, and slowing from a 0.6% gain in July. It was the slowest pace of increase since July 2017, when the index rose 0.5%.

In South Korea, the Kospi advanced 0.11%, while Australia’s S&P/ASX 200 gained 0.76%.

Overall, the MSCI Asia ex-Japan index was up 0.12%.

Asia-Pacific Market Indexes Chart

Investors will watch for developments on the U.S.-China trade front following overnight developments. The South China Morning Post reported Thursday that known China hawk and Trump advisor Michael Pillsbury warned the U.S. is ready to escalate the trade war if a deal isn’t struck soon, citing an interview in Hong Kong.

Meanwhile, Hu Xijin — editor-in-chief of Chinese state media Global Times — tweeted overnight that China is “not as anxious to reach a deal as the US side thought.”

Those developments come as the U.S. and China are expected to hold high-level trade negotiations in the coming weeks.

The People’s Bank of China will also publish its new loan prime rates (LPR) on Friday, set to be out at 9:30 a.m. HK/SIN. The LPR is the interest rate that banks charge their most creditworthy customers and a revamp was announced by the Chinese central bank in August in order to lower borrowing costs to boost the country’s economy.

Overnight stateside, the Dow Jones Industrial Average ended its trading day down 52.29 points at 27,094.79 and the S&P 500 closed around the flatline at 3,006.79. The Nasdaq Composite finished its trading day less than 0.1% higher at 8,182.88.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 98.339 after slipping from levels above 98.4 yesterday.

The Japanese yen traded at 107.98 against the dollar after strengthening from levels above 108.3 in the previous session. The Australian dollar was at $0.6789 after slipping from levels above $0.680 yesterday.

Oil prices rose in the morning of Asian trading hours, with U.S. crude futures jumping 1.26% to $58.86 per barrel and Brent crude futures adding 0.81% to $64.92 per barrel.

What’s on tap:

  • China: People’s Bank of China publishes new loan prime rates at 9:30 a.m. HK/SIN
  • Hong Kong: Consumer Price Index for August at 4:30 p.m. HK/SIN

— Reuters, along with CNBC’s Thomas Franck and Yen Nee Lee, contributed to this report.

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