Asia report: Most markets falter on failure of Trump-Kim talks

Most markets in Asia were in the red at the close on Thursday, after the summit between US president Donald Trump and North Korea leader Kim Jong-un was wound up early, with no agreement being reached between the two nations.

In Japan, the Nikkei 225 was off 0.79% at 21,385.16, as the yen weakened 0.05% against the dollar to last trade at JPY 111.06.

The broader Topix index was also down 0.79% in Tokyo, settline at 1,607.66.

On the mainland, the Shanghai Composite was 0.44% lower at 2,940.95, and the smaller, technology-heavy Shenzhen Composite went against the trend to rise 0.35%, closing at 1,546.33.

In fresh data out of China, the country’s factory activity contracted for the third month in a row in February.

Beijing’s official purchasing managers’ index was down to 49.2 for the month, reaching its weakest level in two years.

Any reading below 50 indicates a contraction in the sector.

South Korea’s Kospi was down 1.76% at 2,195.44, while the Hang Seng Index in Hong Kong fell 0.43% to 28,633.18.

The blue-chip technology stocks received a battering in Seoul, with Samsung Electronics down 3.53% and SK Hynix off 5.02%.

Firms with some exposure to North Korea were understandably out of favour as well, as Hyundai Elevator plunged 18.55%.

Geopolitical and trade tensions were front and centre for the day, with the US and North Korea’s failure to see eye-to-eye in Vietnam a main catalyst for the market falls.

Trump and Kim were hoping to come to some sort of arrangement over the denuclearisation of the Korean peninsula, in return for some relief from economic sanctions for the hermit state.

The ongoing trade war between the US and China was also a concern for investors, after US Trade Representative Robert Lighthizer suggested overnight that a trade deal between the countries was still some way off.

He said an agreement would need to be about more than just purchases from the People’s Republic.

The renewed tension comes just days after an improvement in sentiment, which followed a weekend stream of tweets from Donald Trump in which he pushed back the 1 March negotiation deadline.

Previously, the White House had lined up a fresh round of punitive tariffs ready to slap on China on 1 March, should the nations not have reached a deal by then.

While the delay was initially cheered by market watchers, sentiment has gradually slipped through the week amid a lack of clarity on exactly what the delay meant or how the negotiations would be framed going forward.

Oil prices were in a mixed state as the region went to bed, with Brent crude last down 0.41% at $66.12 per barrel, while West Texas Intermediate rose 0.33% to $57.13.

Things were somewhat rosier in Australasia, with Australia’s S&P/ASX 200 managing gains of 0.3% to close at 6,169.00.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was also in the green, rising 0.5% to 9,325.03.

Both of the down under dollars were weaker against the greenback, with the Aussie last off 0.21% at AUD 1.4033, and the Kiwi retreating 0.43% to NZD 1.4663.