Equity markets crept lower in early Asia-Pacific trading on Friday on the eve of a potentially tumultuous period in global geopolitics, with a testy G7 summit set to get underway in Canada and the landmark summit between US President Donald Trump and North Korean leader Kim Jong Un on Tuesday.
Mr Trump on Thursday lashed out at the French and Canadian leaders, Emmanuel Macron and Justin Trudeau, over the two countries’ trade practices, just as western leaders prepared for what promised to be a fractious G7 summit.
ING chief economist for Asia Pacific Robert Carnell said “It just looks and feels as if, with the weekend looming, and the weekend's Quebec summit likely to highlight huge rifts between the US and the rest of the G-7 on trade, Iran, and the Paris Climate Accord, investors have decided to play it safe.”
Mr Carnell also pointed to a suite of “potential pitfalls” next week, including signals from the European and US central banks, and the highly-anticipated Trump-Kim summit.
In Hong Kong, the Hang Seng was off 0.6 per cent with modest gains from the consumer, energy and industrial segments outweighed by falls across other sectors.
Chinese stocks also dropped, with the CSI 300 of major companies listed in Shenzhen and Shanghai falling 0.3 per cent.
In Sydney, the S&P/ASX 200 was flat with the key financial and basic materials segment eking out small gains but industrial stocks dropping 0.7 per cent.
The Topix in Tokyo was also basically unchanged, with falls for technology and financial stocks offsetting gains from utilities and telecoms.
Cautious sentiment also prevailed in the foreign exchange and sovereign debt markets with currencies steady and US government bond prices slightly lower.
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