Asian stocks ended mixed on Tuesday, the dollar treaded water and bond yields eased amid bets that Fed Chair Jerome Powell will sound less hawkish during two-day testimony before Congress beginning later in the day.
Chinese stocks ended sharply lower after China’s new foreign minister Qin Gang warned of a potential conflict with the U.S. if Washington does not soften its rhetoric against China.
On the sidelines of the “two sessions” political gathering, he outlined China’s foreign policy agenda for the coming years. He signaled closer ties with Russia and termed the relationship with the U.S. and its allies as a source of tension and conflict.
Meanwhile, China’s exports and imports continued their recent declines at the start of the year, combined figures for January and February showed.
China’s Shanghai Composite Index slumped 1.11 percent to 3,285.10, while Hong Kong’s Hang Seng Index shed 0.3 percent to settle at 20,534.48.
Japanese shares eked out modest gains to reach a three-month high after data showed real wages dropped at the fastest pace since 2014 in January, putting less impetus on the central bank to tighten its ultra-loose policy.
The Nikkei 225 Index rose 0.3 percent to 28,309.16 ahead of the final policy meeting for Bank of Japan Governor Haruhiko Kuroda on Thursday and Friday. The broader Topix closed 0.4 percent higher at 2,044.98.
Higher oil prices boosted energy stocks, with Inpex Corp. and Japan Petroleum climbing 3 percent and 1.8 percent, respectively.
Seoul markets swung between gains and losses before finishing marginally higher. Tech heavyweights Samsung Electronics and SK Hynix dropped 1.3 percent and 0.9 percent, respectively, while battery maker LG Energy Solutions jumped 3.5 percent and chemical firm LG Chem added 1.9 percent.
South Korea’s GDP contracted 0.4 percent sequentially in the fourth quarter, revised central bank data showed earlier today, matching the advance estimate released in January.
Australian stocks rose, while the Aussie dollar and government bond yields slid after Reserve Bank Governor Philip Lowe said there were indications that inflation had peaked in the country.
The Reserve Bank of Australia softened its hawkish forward guidance after lifting its cash rate 25 basis points to 3.60 percent, the 10th straight move since last May.
Investors shrugged off mixed trade balance and retail sales data. The benchmark S&P/ASX 200 Index gained 0.5 percent to finish at 7,364.70, while the broader All Ordinaries Index ended 0.5 percent higher at 7,562.70. Mining stocks underperformed after Beijing set its lowest growth target ever.
InvoCare shares soared 35 percent after the funeral services provider received a non-binding takeover offer of $1.81 billion from asset manager TPG Global LLC.
Across the Tasman, New Zealand’s benchmark S&P/NZX 50 Index settled marginally higher at 11,919.56.
Overnight, U.S. stocks gave up early gains to end narrowly mixed, tracking a rebound in U.S. Treasury yields.
The tech-heavy Nasdaq Composite finished 0.1 percent lower, while the Dow and the S&P 500 managed to finish in positive territory.
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