By Gina Lee
Investing.com – Asian stocks were mixed on Tuesday morning, after U.S. markets saw a retreat but technology shares extended gains during the previous session.
Some investors, such as NAB Market Research senior FX strategist Rodrigo Catril, said that the declines were attributable to month-end portfolio rebalancing "rather than a new trend in equities.”
But other investors struck a more cautious note.
“After such a strong summer run, we’re reverting back to the old pandemic playbook so we see tech outperforming... really, that’s a defensive move as people think about stay-at-home more as we’re heading toward that fall season,” Allianz (DE:ALVG) Global Investors senior U.S. investment strategist Mona Mahajan told Bloomberg.
China’s Shanghai Composite inched up 0.04% by 11:38 PM ET (4:38 AM GMT), and the Shenzhen Component was up 0.39%. Following Monday’s release of the manufacturing and non-manufacturing Purchasing Managers’ Indexes (PMIs), the Caixin manufacturing Purchasing Managers’ Index (PMI) for August increased to 53.1, higher than July’s figure of 52.8 and the forecasted 52.6 prepared by Investing.com.
Meanwhile, investors await China’s response after the U.S. said on Monday that it was establishing a new bilateral economic dialogue with the country, increasing tensions between the two countries.
Tensions between China and Australia are also mounting after Chinese authorities detained Australian news anchor Cheng Lei in late August and Australian trade minister Simon Birmingham warned that the risks for Australian businesses engaged with China had “changed”.
Down Under, the ASX 200 slumped 2.17%. The Reserve Bank of Australia is due to hand down its policy decision later in the day, few changes expected.
Hong Kong’s Hang Seng Index inched down 0.03%.
Japan’s Nikkei 225 was down 0.25%. Data released earlier in the day showed that the manufacturing Purchasing Managers’ Index (PMI) rose to 47.2 in August, up from 46.6 in July and the slowest contraction since February.
The contest to become the country’s next prime minister continues to take shape, with the ruling Liberal Democratic Party’s largest faction supporting current chief cabinet secretary. Yoshihide Suga.
South Korea’s KOSPI rose 0.80%. An Il-whan, second vice minister of the Ministry of Economy and Finance said that the ministry would issue as much as KRW172.9 trillion ($145.68 billion) of sovereign debt in 2021, a record bond issuance for the country.
Capping the losses, however, was progress on a potential vaccine for COVID-19, with the U.K.’s AstraZeneca (NYSE:AZN) planning to enroll 30,000 participants in a late-stage study to evaluate its vaccine candidate AZD1222. Hopes were also raised after U.S. Treasury Secretary Steven Mnuchin said on Monday that Senate Republican leader Mitch McConnell could “hopefully” introduce a new bill by the following week, a first step in addressing the stalemate in the U.S. Congress over the latest stimulus measures.