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Asian Stocks Mixed After Trump’s Korea Comments

Asian Stocks Mixed After Trump’s Korea Comments

David Cottle, Analyst

Talking Points

  • Asian stocks ended the week with a whimper as comments from Donald Trump weighed
  • Japanese data were plentiful, but didn’t change that country’s economic story
  • The US Dollar inched up

It may be your favourite currency, but who’s with you? Take a look at the DailyFX sentiment page

Asian markets were broadly weaker into Friday’s close, as some comments from US President Donald Trump seemed to weigh.

Trump reportedly threatened late Thursday to either renegotiate or terminate what he called a “horrible” US trade deal with South Korea, and also said that he wants Seoul to stump for protection of a new anti-missile system, which could run to a billion-dollar bill. South Korean officials told Reuters that they were waiting to see whether any policy steps run from these comments.

Trump also warned that conflict with North Korea was possible, even though he preferred a peaceful resolution.

Shares had been modestly higher by and large but slipped as these remarks crossed the wires. The Nikkei 225 slipped 0.3%, but remains on course for its best weekly gain since last November, some 3.2%. Hong Kong stocks slipped by 0.2%. Chinese mainland stocks had been down as investors worried that regulators would crack down further on speculation and some of the riskier financing methods, but they perked up in the afternoon session. Australia’s ASX ended close to flat.

The US Dollar edged up in Asian trade, while the euro pared some of its monthly gains as the European Central Bank stuck with its monetary easing bias on Thursday. USD/JPY was steady after a deluge of Japanese economic data which, while broad ranging, added nothing to the old picture of a modestly expanding economy still desperate for some domestic pricing power.

Gold prices were little changed Friday but the metal is heading for its worst week for seven as investors increasingly favor riskier assets over the ancient, yield-less haven. Crude oil prices rose, with the US benchmark up about 80 cents/barrel, and Brent up by 40, but the black stuff remains pressured more broadly by worries that production cuts are not meaningfully reducing supply.

The rest of the global session has plenty to offer investors. We’ll get Gross Domestic Product figures from the US, UK and Canada, along with the eurozone consumer price index for April. The University of Michigan’s venerable consumer sentiment snapshot for April will occupy its usual place at the tail end of the monthly data round.

Major bank stocks are also in the spotlight with UBS, RBS and Barclays already out.

--- Written by David Cottle, DailyFX Research

Contact and follow David on Twitter: @DavidCottleFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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