Asia report: Most markets lower as Trump cancels North Korea summit

Markets in Asia finished slightly lower on Friday, following reports that a planned landmark summit between US president Donald Trump and North Korea leader Kim Jong-un had been cancelled by Washington.

The Nikkei 225 was ahead just 0.06% at 22,450.79, as the yen strengthened 0.01% against the dollar to last trade at JPY 109.25.

Airline stocks flew higher in Tokyo after an overnight fall in oil prices, while the mining and oil sectors were lower on the broader Topix index, by 2.82% and 0.87% respectively.

Carmakers were down following news from the US that it had launched an investigation into automotive imports on a “national security” basis.

Honda was down 0.93% and Toyota fell 1.29%.

On the mainland, the Shanghai Composite lost 0.45 to 2,460.80, and the smaller, technology-heavy Shenzhen Composite shed 0.93% to 1,810.03.

South Korea’s Kospi slid 0.21% to 2,460.80, while the Hang Seng Index in Hong Kong slid 0.56% to 30,588.04.

A surge for blue-chip technology stocks in Seoul failed to offset losses among financial plays and steel producers.

Car manufacturers were also on the back foot on the Korean peninsula, with Hyundai off 0.71% and Kia falling 1.38%.

Sentiment was hit hard in the region on Friday, after Donald Trump cancelled a planned meeting with Kim Jong-un, which was set down for 12 June.

In a letter, Trump said participating in the talks would be “inappropriate” in the wake of “tremendous and open hostility” which he alleged North Korea had displayed.

Earlier reports suggested Pyongyang had suspended direct communication with the US earlier this week.

North Korea stuck a conciliatory tone, however, reporting through state media outlet KCNA that it was keen to resolve differences with Washington.

“Risk aversion may persist in the interim, especially on uncertainty over China's role in the US-DPRK negotiation amid the recent uptick in geopolitical tensions again,” noted analysts at OCBC Bank.

In Australia, the S&P/ASX 200 was off 0.07% at 6,032.80, with the energy and materials subindices among the big losers.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 was up 0.6% at 8,638.4, led higher by specialist manuka honey exporter Comvita, which rose 2.8%.

Both of the down under dollars were weaker against the greenback, with the Aussie last off 0.25% at AUD 1.3233 and the Kiwi retreating 0.14% to NZD 1.4455.