- Asian equities dwindle further as Trump administration alleges Chinese companies.
- Trade wars, fears of virus resurgence recently hit the market sentiment.
- Off in China, Hong Kong fails to confine the trades’ risk-off mood amid a light calendar.
With the latest updates from the White House adding strength to the previous pessimism, Asian shares range further towards the south. As a result, MSCI’s index of Asia Pacific shares outside Japan drops 0.40% while Japan’s Nikkei 225 flash 1.6% loss around 22,200. Further, Australia’s ASX 200 also portrays the downbeat sentiment while declining over 2.0% to 5,844 as we write during the early Thursday. Though, New Zealand’s NZX 50 might be looking at the recent trade numbers to print a lesser loss of 1.09%
Following the early-day comments by White House Adviser Peter Navarro, recent updates from Reuters suggest that the US policymakers cite Chinese military backing Huawei and Hikvision. The news propels the already tensed relations between the world’s two largest economies.
In addition to the US-China tension, the American trade updates concerning the European Union (EU), the UK and Asian tire manufacturers have recently favored odds of a major trade war.
Additionally, increasing virus numbers from the US strengthen the fears of the wave 2.0. The pandemic’s likely downbeat economic impact has recently been realized in the International Monetary Fund’s (IMF) another downgrade to 2020 GDP forecast.
Other than the Asian risk barometers, the US 10-year Treasury yields and stock futures are also portraying the grim market conditions.
It’s worth mentioning that traders in Beijing and Hong Kong are enjoying holidays on Thursday. As a result, risk catalysts, mainly concerning the coronavirus (COVID-19) and global trade relations, remain as the key drivers.
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