Asian stocks on Tuesday took a breather after a brief rally triggered by expectations that a trade deal might be within grasp and that the US Federal Reserve could put its monetary policy tightening on pause if economic growth slows further.
MSCI's broadest index of Asia-Pacific shares outside Japan shed early gains, losing 0.1 percent to $478.18 as weakness in China and Taiwan weighed on the index. The Shanghai Composite last stood 0.2 percent lower to CN¥2,526.46, while Taiwan Weighted fell 0.2 percent to NT$9,563.60.
Japan’s Nikkei gained 0.9 percent to ¥20,218.50, while South Korea’s KOSPI dropped 0.5 percent to ₩2,025.27. Hong Kong’s Hang Seng added 0.1 percent to HK$25,862.00.
Cross-assets Strategist Masanari Takada stated that market pessimism has been rolled back, partly helped by hopes for the US-China trade talks, but many investors are still trying to play it safe and it is yet to be seen whether the recovery continues, or ends up as a short-term relief rally.
In the US, the S&P 500 added 0.7 percent to $2,549.69 on Monday following a 3.4 percent climb on Friday, with e-commerce firm Amazon.com Inc. and online media-services provider Netflix Inc. as main drivers of the rally.
Rise in tech names slightly eased concerns, prompted by tech giant Apple Inc.’s warning last week, about the thriving sector beginning to feel the impact of the US-China trade war.