TOKYO, Japan (AP) – Asian stocks fell largely on Tuesday, as some investors opted to wait and watch after U.S. markets were closed for a national holiday.
Some investors were also dissatisfied after a meeting between Chinese President Xi Jinping and Secretary of State Antony Blinken produced no signs of progress on Taiwan, human rights, technology, or other contentious areas.
The Nikkei 225, Japan’s benchmark index, fell 0.6% to 33,161.94. The S&P/ASX 200 index in Australia rose 0.9% to 7,362.90. The Kospi in South Korea fell 0.3% to 2,601.07. The Hang Seng in Hong Kong fell 1.4% to 19,627.86, while the Shanghai Composite fell 0.2% to 3,248.53.
The Chinese authorities stated that the meeting between Xi and the senior US official resulted in “candid and in-depth” discussions. Bilateral ties have reached an all-time low. Both parties expressed a readiness to work together.
“There is no doubt that China and the United States need each other, and that their relationship needs to be put back on a more secure footing for mutually beneficial commercial reasons, as well as to reduce the risk of actual conflict,” said Clifford Bennett, chief economist at ACY Securities, in a commentary.
The Chinese economy is recovering more slowly than expected from the disruptions created by attempts to eradicate COVID-19, prompting the central bank to decrease its benchmark 1-year lending prime rate by a tenth of a percentage point to 3.55% on Tuesday.
The 5-year rate was reduced to 4.2% in an effort to loosen lending and encourage spending and investment in order to boost economic activity.
Recent softening steps show that reopening attempts are losing lustre, laying the framework for greater policy involvement in the coming months,” IG’s Yeap Jun Rong wrote in a commentary.
Markets in the United States were closed for the Juneteenth national holiday. Markets are also keeping an eye on the path of interest rate hikes.
The Federal Reserve held its benchmark lending rate constant last week, the first time in ten months that it has not announced a hike. The Fed has warned that it may raise interest rates twice more this year.