Asian shares have inched up in early trade, with investors cautious ahead of tense US-China trade talks while the Turkish lira slipped over concerns about Ankara’s planned incursion in northern Syria.
MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.13 per cent while Japan’s Nikkei rose 0.53 per cent.
Chinese markets will reopen after a one-week holiday. Hong Kong-listed ETFs linked to Shanghai 50 index have fallen 0.8 per cent this period. Hong Kong was closed too on Monday.
Spending on retail goods and dining during China’s week-long National Day holidays returned to growth this year, offering unexpected respite to an economy that has been expanding at its weakest pace in almost three decades.
On Wall Street, the S&P 500 lost 0.45 per cent on Monday, unable to sustain gains made after positive tweets and news headlines about the trade talks.
“Given the importance of the event, markets will be extremely nervous. I expect things to stay this way for now. On the whole, markets are not that optimistic about the outlook,” said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui Asset Management.
US and Chinese deputy trade negotiators on Monday launched two days of talks aimed at paving the way later this week for the first minister-level negotiations in months.
But prospects for progress in US-China trade talks dimmed after Washington blacklisted Chinese companies over Beijing’s treatment of predominantly Muslim ethnic minorities, and President Donald Trump said a quick trade deal was unlikely.
The talks are getting underway ahead of a scheduled increase in US tariffs on $US250 billion ($A370 billion) worth of Chinese goods, to 30 per cent from 25 per cent on October 15.
Trump has said the tariff increase will take effect if no progress is made in the negotiations.
In the currency market, the biggest mover was the Turkish lira, which declined more than 2 per cent on Monday over concerns about Ankara’s planned incursion in northern Syria.
Trump threatened to destroy Turkey’s economy if Ankara takes a planned military strike in Syria too far even though the US leader himself has opened the door for a Turkish incursion.
The lira traded at 5.8375 per dollar, near its weakest level since Sept. 2.
Major currencies were more range-bound.
The euro stood at $US1.0973, with its recovery from its two-and-a-half-year low of $US1.10879 hit a week ago meeting a strong resistance around $US1.10.
The dollar traded at 107.24 yen, having found some support around 106.50 yen in the past few sessions.
Sterling traded at $US1.2290, capped by concerns that sizeable differences between Britain and the European Union remained for striking a Brexit withdrawal deal.
The offshore yuan traded at 7.135 yuan per dollar, slightly stronger than just before China’s market holiday.
US debt yields jumped back as $US78 billion $A115 billion) in note and bond supply slated for auction this week helped push prices lower after last week’s dramatic rise.
The 10-year US Treasuries yield last stood at 1.563 per cent .
Oil prices bounced back a tad from falls on Monday, but remained hobbled by trade uncertainties.
Brent crude futures rose 0.34 per cent to $US58.55 a barrel while US West Texas Intermediate (WTI) crude gained 0.47 per cent to $US53.00 per barrel.
AAP
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