Asia shares mostly gain, Shanghai up 3% after US tariff hike
By YURI KAGEYAMA AP Business Writer
May 10, 2019 12:46 AM
Trader Ryan Falvey works on the floor of the New York Stock Exchange, Thursday, May 9, 2019. Stocks are opening broadly lower on Wall Street as investors keep a close eye on trade talks between the U.S. and China.
Shares were mostly higher in Asia on Friday in volatile trading, with mainland Chinese stocks bouncing more than 3% as regulators apparently stepped in to support the markets.
The Shanghai Composite index surged 3.1% to 2,939.21 while the A-share index in the smaller market of Shenzhen jumped 3.8%. Traders said Chinese institutional investors stepped up buying to support the market with increased liquidity.
Hong Kong’s Hang Seng gained 1.0% to 28,580.39, while Japan’s Nikkei 225 slipped 0.3% to finish at 21,344.92. Australia’s S&P/ASX 200 rose nearly 0.3% to 6,310.90. South Korea’s Kospi gained 0.3% to 2,108.04 and India’s Sensex edged 0.1% higher to 37,607.97. Shares fell in Taiwan and Thailand but rose in most other regional markets.
The Trump administration raised duties on $200 billion of Chinese imports from 10% to 25%. China’s Commerce Ministry said would take “necessary countermeasures” but gave no details. The action followed negotiations in Washington between American and Chinese negotiators.
Analysts said China could raise tariffs on some U.S. exports, though the amount would not match the costs imposed by the increase in U.S. import duties. It could step up interference in U.S. companies’ deal-making and other areas.
The increased tensions, if not resolved soon by a deal between Beijing and Washington, could hurt growth across the region and beyond, said Rajiv Biswas of HIS Markit.
“The escalating U.S.-China trade war adds to significant existing headwinds already facing the Asia-Pacific region from a range of factors, including the sharp slowdown in global electronics new orders and weak new orders in the Eurozone manufacturing,” Biswas said.
Tensions between the world’s two largest economies had dragged stocks on Wall Street lower. The worries about trade this week have stifled what has been the hottest start to a year for U.S. stocks in decades.
The S&P 500 fell 0.3% to 2,870.72. The benchmark index has essentially given back all its April gains, though it’s still up 14.5% for the year.
The Dow Jones Industrial Average dropped 0.5% to 25,828.36. It was down nearly 450 points in morning trading before regaining much of the ground it lost.
The Nasdaq composite slid 0.4%, to 7,910.59. The Russell 2000 index of small company stocks gave up 0.3%, to 1,570.06.
ENERGY: Benchmark U.S. crude rose 45 cents to $62.15 a barrel in electronic trading on the New York Mercantile Exchange. It dropped 0.7% to settle at $61.70 per barrel overnight. Brent crude, the international standard, added 41 cents to $70.80 a barrel.
CURRENCIES: The dollar inched up to 109.78 Japanese yen from 109.77 yen. The euro strengthened to $1.1228 from $1.1216.
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