Asian shares traded cautiously Monday morning as investors waited for a new round of high-level U.S.-China trade talks, which are set to begin later in the week.
Japan’s Nikkei 225 slipped 0.39 percent in early trade while the Topix shed 0.29 percent. Shares of Japanese conglomerate Softbank Group declined 0.82 percent.
South Korea’s Kospi traded flat as industry heavyweight Samsung Electronics rose 0.22 percent. Other tech stocks struggled for gains: Chipmaker SK Hynix fell 1.47 percent, LG Electronics declined 1.01 percent and Samsung SDI was down 2.58 percent.
Australia’s stock market is closed for a public holiday.
China is set to send a delegation led by Vice Premier Liu He to Washington for a fresh round of high level trade talks later this week.
Investors will be keeping a lookout for any important developments on the U.S.-China trade front, with the two sides racing to strike a deal before a deadline in early March. Beijing and Washington have been locked in an ongoing trade war, which saw both sides slap tariffs on each other’s goods.
“Hopes are fairly buoyant with Chinese Vice Premier Liu He set to arrive in the US to lead Beijing’s negotiations this time. An open and constructive dialogue is expected, given low-hanging fruits on trade deficit reduction. But a ‘comprehensive deal’ will elude,” Vishnu Varathan, head of economics and strategy at Mizuho Bank, said in a morning note.
For his part, Varathan said he expected “time may be bought” on hiking tariff rates on the $200 billion worth of Chinese imports from 10 percent to 25 percent. But, he added, rolling back tariffs is “too high a bar.”
Ahead of the expected trade negotiations, U.S. Treasury Secretary Steven Mnuchin said he thought the two countries were “making a lot of progress” in trade talks and that he looked forward to discussions with China’s Liu, Reuters reported last Friday.
Mnuchin’s comments came hours after Commerce Secretary Wilbur Ross told CNBC that the U.S. was still “miles and miles” from reaching a trade deal with China.
Meanwhile, the New York Times reported that U.S. President Donald Trump’s administration has been pressuring America’s allies to bar Huawei and other Chinese tech firms from building the infrastructure needed for the implementation of the next generation 5G wireless standard.
Huawei is under mounting international pressure about the security of its technology, and is part of the larger narrative of the U.S.-China trade battle.
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 95.737 after seeing highs above 96.6 last week.
The Japanese yen, widely seen as a safe-haven currency, traded at 109.39 after seeing lows above 109.8 in the previous trading week. The Australian dollar changed hands at $0.7179 after touching lows below $0.710 last week.
— CNBC’s Berkeley Lovelace Jr. contributed to this report.
