Market Overview

No-deal between Xi Jinping and Trump could crash the Asian market

Asian shares wavered on Friday as investors were on edge before a crucial weekend meeting between the Chinese and U.S. presidents that could determine the course of a heated trade war over the next year. MSCI’s broadest index of Asia-Pacific shares outside Japan wobbled between positive and negative territory in early trade, as more evidence of a slowdown in China dampened sentiment. It was last up less than 0.1 percent and has risen 2.7 percent for the week so far, largely reflecting a rebound from a recent steep sell-off.

In Japan, the Nikkei was up 0.4 percent, while Korean shares dropped 0.2 percent after the country’s central bank lifted its policy interest rate in a widely expected decision. Chinese blue-chips advanced 0.5 percent despite a survey showing China’s factory growth stalled for the first time in more than two years in November.

The weak manufacturing growth reinforced expectations that Beijing will roll out more economic support measures – a factor that has helped to prop up battered Chinese stocks recently. Investor attention is now squarely focused on planned talks between Chinese President Xi Jinping and his U.S. counterpart over the weekend on the sidelines of a G20 summit in Argentina. Victor Huang, head of investment strategy at Guotai Junan International in Hong Kong, said a no-deal outcome could lead to “much more volatile” markets next week. U.S. S&P e-mini futures ticked down 0.06 percent, pointing to a weaker Wall Street session on Friday after a mixed overnight performance. The Dow Jones Industrial Average fell 0.11 percent, the S&P 500 lost 0.22 percent, and the Nasdaq Composite dropped 0.25 percent on Thursday.

Asian shares wobble before Trump-Xi meeting, Reuters, Nov 30
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