Asia report: Most markets higher as investors look past tariff threats

Most markets in Asia finished Thursday’s session higher, as investors shrugged off ongoing trade concerns between the US and China to instead focus on what was shaping up to be a solid earnings season.

In Japan, the Nikkei 225 was up 1.17% at 22,187.96, as the yen weakened 0.5% against the dollar to last trade at JPY 112.57.

Gains in Tokyo were led by the fisheries and forest sector, followed closely by pharmaceutical plays and telecoms.

On the mainland, the Shanghai Composite rose 2.18% to 2,838.30, and the smaller, technology-heavy Shenzhen Composite advanced 2.74% to 1,597.17.

South Korea’s Kospi managed gains of 0.19% to 2,285.06, while the Hang Seng Index in Hong Kong added 0.6% to 28,480.83.

Carmakers were ahead in Seoul, while the blue-chip technology stocks were mixed, with Samsung Electronics falling 1.09%.

Sentiment improved from Wednesday’s depressed session in the region, which stemmed from an announcement out of Washington that the Trump administration was considering punitive tariffs on a further $200bn of Chinese goods.

China’s response this time was to retaliate “qualitatively”, as well as preparing to lodge a complaint to the World Trade Organisation should the US go ahead with the move.

Markets in Asia has suffered in recent weeks in the lead-up to tariffs on $34bn of Chinese exports, which came into force last Friday and were closely followed by equal retaliatory charges levied on the US by Beijing.

Analysts were unsure whether the implementation of the new, much broader tariffs would lead to a short blip like last week.

“Each time we take a further step into the war zone, markets have a little wobble like the one they have just had,” noted ING’s head of Asia Pacific research Robert Carnell.

“Equities sell off a bit, then, so long as there is no further bad news for a week or so, they begin to sit back up again.”

Carnell said given the potentially lasting effects of the tit-for-tat moves between Washington and Beijing, the markets should be moving towards “deeper and prolonged selling” over the temporary corrections seen in recent weeks.

Oil prices were higher, with Brent crude last up 1.19% at $74.28 per barrel, and West Texas Intermediate adding 0.66% to $70.85.

In Australia, the S&P/ASX 200 finished the day 0.85% higher at 6,268.30, led higher by the healthcare subindex, while energy stocks fell.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was down 0.2% at 8,985.47, falling below the 9,000 level which it only reached a few sessions earlier.

It was led lower by specialist dairy products exporter A2 Milk, which fell 3.5% even after it beat its own guidance on annual sales.

The down under dollars were mixed against the greenback, with the Aussie last 0.18% stronger at AUD 1.3550, and the Kiwi retreating 0.01% to NZD 1.4800.