Manila (Philippines), Jul 2 (AP) Asian shares were mixed on Wednesday following a similar drift overnight on Wall Street as losses for Tesla and other technology shares put a brake on the momentum of recent record highs.
US futures edged higher and oil prices were little changed.
Shares fell in Japan, hit by jitters over a lack of progress in trade talks with the US, but they recovered much of their lost ground, trading 0.3 per cent lower at 39,874.33.
Stephen Innes, managing partner at SPI Asset Management, pointed to President Donald Trump’s declaration that there will be no extension of his tariff pause, which ends on July 9.
“The message was blunt: if Tokyo won’t yield, it will pay. Tariffs of 30 per cent, 35 per cent or whatever number we determine’ are now openly back on the table,” he said. “The negotiating table just became a pressure cooker.”
Hong Kong’s Hang Seng advanced 0.6 per cent to 24,220.65 and the Shanghai Composite index was down just over 1 point at 3,456.51.
South Korea’s KOSPI fell 1.2 per cent to 3,053.39 as inflation rose in June.
Australia’s S&P ASX 200 edged up 0.4 per cent to 8,580.70.
On Tuesday, the S&P 500 dipped 0.1 per cent to 6,198.01 for its first loss in four days. The Dow Jones Industrial Average rose 0.9 per cent to 44,494.94, and the Nasdaq composite fell 0.8 per cent to 20,202.89.
Tesla tugged on the market as the relationship between its CEO, Elon Musk, and President Donald Trump soured even further. Once allies, the two have clashed recently, and Trump suggested there’s potentially “BIG MONEY TO BE SAVED” by scrutinizing subsidies, contracts or other government spending going to Musk’s companies.
Tesla fell 5.3 per cent. It has lost just over a quarter of its value so far this year, 25.5 per cent, in large part because of Musk’s and Trump’s feud.
Drops for several darlings of the artificial-intelligence frenzy also weighed on the market. Nvidia’s decline of 3 per cent was the heaviest weight on the S&P 500.
But more stocks within the index rose than fell, led by several casino companies. They rallied following a report showing better-than-expected growth in overall gaming revenue in Macao, China’s casino hub. Las Vegas Sands gained 8.9 per cent, Wynn Resorts climbed 8.8 per cent and MGM Resorts International rose 7.3 per cent.
Automakers outside of Tesla were also strong, with General Motors up 5.7 per cent and Ford Motor up 4.6 per cent.
The US stock market has made a stunning recovery from its springtime sell-off of roughly 20 per cent. But challenges still lie ahead for Wall Street, with one of the largest being the continued threat of Trump’s tariffs.
Many of Trump’s stiff proposed taxes on imports are currently on pause, and they’re scheduled to kick into effect in about a week. Depending on how big they are, they could hurt the economy and worsen inflation.
Washington is also making progress on proposed cuts to tax rates and other measures that could send the US government’s debt spiralling higher, which could raise inflation. That in turn could mean higher interest rates, which would hurt prices for bonds, stocks and other investments.
Despite such challenges, strategists at Barclays say they see signals of euphoria among some investors. The strategists say a measure that tries to show how much “excess optimism” is in the market is not far from the peaks seen during the “meme stock” craze that sent GameStop to market-bending heights or to the dot-com bubble at the turn of the millennium.
In other dealings early Wednesday, benchmark US crude gained 1 cent to USD 65.46 per barrel. Brent crude, the international standard, rose 5 cents per barrel to USD 67.16.
The US dollar rose to 143.58 Japanese Yen from 143.41 Yen. The euro slid to USD 1.1798 from USD 1.1808. (AP) RD RD
