Asia stock markets mixed as China-US tariffs take effect

Asia’s major markets were mixed yesterday as China and the US exchanged fresh tit-for-tat tariffs on billions of dollars of goods while the two sides held talks on their long-running trade dispute.Washington imposed levies on $16bn in Chinese imports, sparking an immediate retaliation in kind from Beijing, which said it “firmly opposes the tariffs and has no choice but to continue to make the necessary counter-attacks”.China also said the US was “clearly suspected” of violating World Trade Organisation rules and that it would file a lawsuit with the group.It is the second round of such measures after the world’s top two economies swapped tariffs on $34bn of goods in July.The fresh tariffs came as officials from each side hold their first talks since June aimed at easing a row that has dragged on equities for months.However, observers are cautious about what progress they will make initially.Stock markets in Asia fluctuated through the day and by the close Tokyo was up 0.2% at 22,410.82 while Shanghai rose 0.4% to 2,724.62.Singapore jumped 1.6% after a one-day holiday and Seoul gained 0.4% but Hong Kong fell 0.5% to 27,790.46 and Wellington was also lower.Sydney fell 0.3% – and the local dollar shed 0.8% – as Australia’s Prime Minister Malcolm Turnbull fights for his political life following a leadership challenge.The S&P/ASX 200 was also being dragged by a 2.8% plunge in Qantas as a jump in the airline’s profits was offset by its worries about rising fuel costs.Investors are keeping tabs on developments in Washington after President Donald Trump’s former personal adviser admitted a series of charges including illegal use of election funds.The US leader’s ex-campaign manager was also convicted on several counts including bank and tax fraud.On currency markets the dollar sprang back to life against the yen, pound and euro as well as most high-yielding units after this week’s travails, with Federal Reserve minutes signalling it is ready to lift rates again as the economy continues to improve.“Many participants suggested that if incoming data continued to support their current economic outlook, it would likely soon be appropriate to take another step,” the minutes said.The greenback had taken a hit this week from Trump’s comments criticising the central bank’s rate increases and accusing it of not backing his economic plan.However, the Fed’s policy committee pointed to “ongoing trade disagreements and proposed trade measures as an important source of uncertainty and risks”.In addition, most members said “an escalation in international trade disputes was a potentially consequential downside risk for real activity”.Attention now turns to this week’s annual central bankers’ symposium at Jackson Hole in Wyoming, with investors hoping for some idea about governors’ plans in light of the China-US trade row.