Asian Shares Mixed In Cautious Trading

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Asian stocks ended mixed on Tuesday as a virtual meeting between U.S. President Joe Biden and Chinese President Xi Jinping, the closest communication between the two leaders since Biden took office in January, produced no major breakthrough on relations nor agreements to ease tensions.

Traders also awaited speeches by a number of Federal Reserve officials this week for additional clues on interest rates and monetary policy going forward.

Chinese shares ended a tad lower as the country battled its biggest COVID-19 outbreak caused by the highly transmissible Delta variant. The benchmark Shanghai Composite Index fell 11.52 points, or 0.3 percent, to 3,521.79.

Hong Kong’s Hang Seng Index rallied 322.87 points, or 1.3 percent, to 25,713.78 amid policy easing bets as authorities in several mainland provinces appear to have relaxed rules to spur home sales.

Razer shares soared 11.5 percent after reports that executives at the gaming hardware firm are leading a consortium plan to value the company at up to 35 billion Hong Kong dollars (about $4.49 billion).

Japanese shares ended marginally higher amid a lack of major catalysts. The Nikkei 225 Index edged up 31.32 points, or 0.1 percent, to 29,808.12, while the broader Topix ended 0.1 percent higher at 2,050.83.

Automakers were in focus, with Subaru climbing 5.2 percent after JPMorgan Securities raised its rating and price target on the stock. Toyota Motor advanced 1.9 percent after announcing last week that it began making up for production lost from supply shortages in December.

Insurers T&D Holdings and Dai-ichi Life Holdings rose 2.6 percent and 1.7 percent, respectively as U.S. Treasury yields gained.

Australian markets fell notably as the central bank talked down the threat of rate hikes in 2022 despite inflation uncertainty.

The benchmark S&P/ASX 200 Index dropped 49.70 points, or 0.7 percent, to 7,420.40, while the broader All Ordinaries Index ended down 51.10 points, or 0.7 percent, at 7,747.10.

Miners and banks succumbed to selling pressure, while tech stocks outperformed. Rio Tinto, BHP, Iluka Resources and Mount Gibson Iron tumbled 2-6 percent as iron ore prices continued to soften.

Seoul stocks fluctuated before ending on a flat note as a virtual summit between the presidents of the United States and China ended with a pledge to improve cooperation. The Kospi slipped 2.31 points to close at 2,997.21.

Automaker Hyundai Motor declined 1.2 percent and its smaller affiliate Kia Corp gave up 2.7 percent, while leading chemical firm LG Chem climbed 1.6 percent.

New Zealand shares ended lower on concerns about inflation and interest rate hikes after a Bank of England governor said he was “very uneasy about the inflation situation.”

The benchmark NZX-50 Index dropped 61.75 points, or 0.5 percent, to 12,902.71, with Meridian Energy, Genesis Energy and A2 Milk leading losses.

The major U.S. averages ended marginally lower overnight as concerns over rising Treasury yields offset data showing strong growth in New York manufacturing activity in November.

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