Asia Markets

Asia stocks mixed as investors grapple with uncertainty over US-China trade

Key Points
  • Stocks in Asia were mixed on Friday following days of declines this week amid U.S.-China trade confusion.
  • Markets have had a rocky trading week amid mixed headlines on U.S.-China trade.

Stocks in Asia were mixed on Friday following days of declines this week amid U.S.-China trade confusion.

Mainland Chinese stocks fell on the day, with the Shanghai composite down 0.63% to about 2,885.29 and the Shenzhen component shedding 1.51% to 9,626.90. The Shenzhen composite also fell 1.454% to around 1,607.51. Hong Kong's Hang Seng index was about 0.3% higher, as of its final hour of trading.

Elsewhere, the Nikkei 225 rose 0.32% to close at 23,112.88 while the Topix index ended its trading day 0.12% higher at 1,691.34. Shares of gaming firm Nintendo, however, fell 3.51% after Morgan Stanley downgraded the stock to equal-weight from overweight.

In South Korea, the Kospi closed 0.26% higher at 2,101.96.

Meanwhile, shares in Australia rose as the S&P/ASX 200 finished its trading day 0.55% higher at 6,709.80.

Shares of Westpac declined 1.55% after Goldman Sachs cut its price target for the stock by 10%, according to Reuters. The lender's stock has slipped in the past few days. Australia's anti money-laundering and terrorism financing regulator filed for civil penalty orders against the firm, alleging its "oversight of the banking and designated services provided through its corresponding banking relationships was deficient."

Overall, the MSCI Asia ex-Japan index was 0.13% higher.

Markets have had a rocky trading week amid mixed headlines on U.S.-China trade.

The Wall Street Journal reported Thursday that Chinese Vice Premier Liu He, during a phone call thought to have been made late last week, had invited U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin to Beijing to sit down for further talks.

It was not clear whether U.S. negotiators had accepted Liu's invitation. However, the Journal's report said that U.S. trade officials were willing to meet with their Chinese counterparts. Meanwhile, the South China Morning Post said both countries are on the "doorstep" of reaching a deal, citing a source close to the Trump administration.

"I think the phase one agreement is important. One, because it would put a trade truce between China and the United States. Two, it'd build a little confidence and certainty in the trading system," Myron Brilliant, executive vice president and head of international affairs at the U.S. Chamber of Commerce, told CNBC's "Squawk Box" on Friday.

"It is a step in the right direction if the deal can get done," Brilliant said.

"There's a little bit of an impasse right now after the enthusiasm expressed by President Trump when Vice Premier Liu He visited Washington and I had a chance to sit down (with) Liu He. And I explained to him: 'You're gonna have to have some give and take here, but China has to bring more to the table to get the final package,'" he added.

The matter has been further complicated by U.S. legislation on Hong Kong, which has been rocked by months of protests. The U.S. House of Representatives passed a bill on Wednesday intended to support protesters in Hong Kong. It prompted Beijing to accuse the U.S. of interfering in domestic affairs. U.S. President Donald Trump has yet to sign the bill.

"China has called on the President to veto the bill but with unanimous Senate and House support, its highly unlikely that he will do so," Kathy Lien, managing director of foreign exchange strategy at BK Asset Management, wrote in an overnight note.

"They have threatened forceful measures if the bill is signed so expect to tensions to escalate when that happens," Lien said.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 97.919 after seeing an earlier high of 97.964.

The Japanese yen traded at 108.56 per dollar after strengthening from levels above 108.9 seen earlier in the trading week. The Australian dollar changed hands at $0.6785 after declining from highs around $0.681 yesterday.

Oil prices declined in the afternoon of Asian trading hours, with international benchmark Brent crude futures shedding 0.55% to $63.62 per barrel. U.S. crude futures also slipped 0.51% to $58.28 per barrel.

— CNBC's Fred Imbert contributed to this report.

Correction: This report was updated to reflect that the Shenzhen component and Shenzhen composite fell on Friday.