The U.S. has the largest economy in the world and second place belongs to China. Thus, tensions between the largest economies have the potential to create additional problems for the global economy. On Wednesday, investors analyzed the potential impact of rising tensions between Washington and Beijing. Let’s have a look at the stocks across Asia.
Mainland Chinese stocks saw losses on the day. The Shanghai Composite fell 0.34% to about 2,836.80. At the same time, the Shenzhen Composite dropped 0.855% to around 1,774.22.
Also, Hong Kong’s Hang Seng index fell 0.71% as of its final hour of trading.
In Japan, the Nikkei 225 advanced 0.75% to close at 21,419.23 as shares of the robot market Fanuc jumped 2.18%. In the meantime, the Topix index added 0.96% to end its trading day at 1,549.47.
South Korea’s Kospi index closed slightly higher at 2,031.20.
Interestingly, Australia’s S&P/ASX 200 slightly fell to finish its trading day at 5,775.
Stocks and new challenges
The trade war between the U.S. and China started in 2018. It took more than a year to reach an agreement. This year, the U.S. and China signed a partial trade deal. However, the trade war is not over yet as there other issues as well.
However, the ongoing coronavirus pandemic could jeopardize the future of trade deal and the U.S. -China relations in general. Moreover, apart from coronavirus, there is another challenge. This issue is connected with Hong Kong. Notably, Hong Kong is an important financial hub.
On Tuesday, U.S. President Donald Trump said he would make an announcement regarding the administration’s response to China’s actions. According to Trump, he plans to make this announcement by the end of the week. Based on the information, the U.S. was considering sanctions on Chinese firms as well as officials due to the situation in Hong Kong.
The U.S. and China should try to avoid confrontation as pandemic created many issues for the global economy. There is no need to add other problems, that could affect stocks.
COMMENTS