Asian Markets Drop After Trump’s Disappointment With China Trade Talks

Asian equity markets were down on Wednesday following remarks by President Donald Trump saying he was "not satisfied" with the achievements made in the latest trade negotiation with representatives of China.

In Japan, the Nikkei 225 index dropped 1.16 percent to close at 22,695.00 points, with a stronger yen weighing on exporters. The dollar was down earlier this morning against its Japanese rival.

The US dollar index, which measures the greenback’s strength against a basket of six major competitors, was up 0.05 percent at 93.58 by the time of this writing.

The broader Topix also came under pressure, closing down percent 0.68. Nearly all of its 33 subindexes traded in red territory, with mining and oil sectors components among worst performers as their losses were between 3-4 percent.

Seoul’s Kospi benchmark traded in a narrow range, remaining close to flat line as gains in the technology sector were capped by declines in other components. Heavyweight Samsung Electronics rose more than 2 percent in today’s session.

Down under, Australia’s S&P/ASX 200 eased 0.16 percent, with energy companies weighing on the index, while financials were recovering previous session’s losses.

Hong Kong's Hang Seng Index was down percent 1.43 by the time of this writing. In China, the Shanghai composite was down 1.40 percent and the Shenzhen composite fell 1.25 percent.

Trump said bilateral talks with China on trade regulation hasn’t been satisfactory in his opinion, derailing a prior belief that the situation has finally stabilized and trade war was prevented.

On Tuesday, China said tariffs on some vehicles will be reduced from 25 to 15 percent. Earlier this week, US Treasury Secretary Steven Mnuchin said talks in Washington had made "very meaningful progress".

In other news, President Trump said there was a "substantial chance" that a summit with North Korean leader Kim Jong Un "may not work out."

"There are certain conditions that we want and I think we'll get those conditions and if we don't we don't have the meeting [with Kim Jong Un],” the President said.

Economic Calendar:

Europe: Germany’s Q1 GDP is up at 06:00 GMT, with a 0.3 percent q/q growth rate seen. Preliminary readings on manufacturing and services PMIs for May will be out at 07:30 GMT. EU’s manufacturing and services PMIs will be released at 08:00 GMT. In the UK, focus will be at the CPI and PPI Input, both scheduled at 08:30 GMT.

United States: Markit Economics is expected to present preliminary manufacturing and services activity data at 13:45 GMT. New home sales for April are next at 14:00 GMT. Also, the Energy Department will unveil official crude inventories half and hour later. Minutes of the latest FOMC monetary policy meeting will be out at 18:00 GMT.

FortFS