Asian Shares Slide Ahead Of China's Rate Decision

Asian stocks retreated on Monday as investors exercised cautious ahead of China’s interest-rate decision and Fed Chair Jerome Powell’s testimonies.

The dollar held steady after having suffered heavy losses against its major rivals last week.

Gold dipped as investors awaited congressional testimonies from Fed Chair Powell on Wednesday and Thursday for clues on the monetary policy ahead.

Oil prices dipped in Asian trading on concerns that China’s economic recovery is faltering.

Chinese shares ended lower as hopes faded for a major stimulus and investors awaited the June loan prime rate announcement scheduled for Tuesday.

China’s Shanghai Composite index dropped 0.54 percent to 3,255.81, with property developers and insurers falling after Friday’s State Council meeting ended with no concrete policies to boost the economy.

Hong Kong’s Hang Seng index fell 0.64 percent to 19,912.89 as U.S. Secretary of State Antony Blinken held a second and final day of critical meetings with senior Chinese officials amid escalating tensions and complex dynamics between the world’s two largest economies.

Japanese shares fell sharply as chipmakers tumbled after scoring sharp gains in recent sessions.

The Nikkei average fell 1.0 percent to 33,370.42, after having hit a 33-year high to post its 10th consecutive weekly gain on dovish signals from the Bank of Japan. The broader Topix index ended 0.43 percent lower at 2,290.50.

Advantest, Tokyo Electron and Screen Holdings dropped 2-3 percent. Uniqlo brand owner Fast Retailing shed 1.4 percent and automaker Toyota Motor gave up 2.7 percent.

Seoul stocks ended notably lower, with the Kospi average ending down 0.62 percent at 2,609.50 after Fed Gov. Christopher Waller said core inflation was not coming down like he expected. Richmond Fed President Thomas Barkin also backed the idea of more rate hikes, citing persistent inflation.

Australian markets advanced led by gold miners, banking and financial stocks.

The benchmark S&P ASX 200 climbed 0.60 percent to 7,294.90, touching its highest level since May 2 ahead of minutes of the June policy meeting of the Reserve Bank due Tuesday. The broader All Ordinaries index closed 0.51 percent higher at 7,489.20.

lithium developer Lake Resources plunged 20 percent after it announced a three-year delay to first production from its Kachi project in Argentina.

Across the Tasman, New Zealand’s benchmark S&P/NZX 50 index ended down 0.42 percent at 11,750.75 despite positive data on the country’s services sector.

U.S. stocks reversed direction to end lower on Friday after recent strong gains.

Economic data brought some cheer, with a measure of consumer sentiment rising in June to the highest level in four months while consumers’ near-term inflation expectations dropped to more than a two-year low.

The tech-heavy Nasdaq Composite shed 0.7 percent, the S&P 500 slipped 0.4 percent and the Dow eased 0.3 percent.

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