Asian shares mixed ahead of Korean drills, banker meeting

Asian stocks were mixed Monday as investors monitored join military drills between U.S. and South Korean forces and awaited a key meeting of central bankers later this week. (Photo by Allan Ajifo, CC BY 2.0)

KEEPING SCORE: Japan’s benchmark Nikkei 225 index lost 0.4 per cent to 19,384.64 and South Korea’s Kospi dipped 0.2 per cent to 2,354.28. Hong Kong’s Hang Seng rose 0.4 per cent to 27,159.33 and the Shanghai Composite Index edged up 0.1 per cent to 3,272.20. Australia’s S&P/ASX 200 shed 0.4 per cent to 5,724.20.

MOUNTAIN MEETING: Central bank officials from around the world will be gathering for an annual three-day conference at a mountain resort in Jackson Hole, Wyoming, starting Thursday. Investors will be scrutinizing remarks from the policymakers due to speak, including Fed chief Janet Yellen and European Central Bank head Mario Draghi, for any hints on the future direction of interest rates and economic stimulus programs, which will have implications for global stock markets.

MARKET VIEW: “All eyes turn to Wyoming this week, where central bank heads and academics come together to swap ideas, and this time, in all probability, to ask, ‘Where on earth is the inflation we all expected, and what do we do with rates?”’ said ING Economist Rob Carnell.

WAR GAMES: U.S. and South Korean forces are starting annual joint military exercises that could further rile North Korea. These war games have the potential to stoke geopolitical tensions and market jitters more than usual, given recent threats by both Trump and Pyongyang.

BYE TO BANNON: U.S. President Donald Trump’s administration endured another shakeup over the weekend when divisive strategist Steve Bannon was shown the door. Now that Bannon, who had called in an interview for an “economic war” with China, is gone, investors may feel it’s a bit more likely the administration can achieve at least some of its pro-business agenda.

WALL STREET: Major U.S. benchmarks turned negative in the final minutes of trading on Friday, falling to their lowest levels since early July. The S&P 500 lost 0.2 per cent to close at 2,425.55. The Dow Jones industrial average fell 0.3 per cent to 21,674.51. The Nasdaq composite shed 0.1 per cent to 6,216.53.

ENERGY: U.S. benchmark crude oil futures rose 2 cents to $48.53 a barrel in electronic trading on the New York Mercantile Exchange. The contract jumped $1.42, or 3 per cent, to settle at $48.51 a barrel on Friday. Brent crude, the international standard, added dipped 1 cent to $52.71 a barrel in London.

CURRENCIES: The dollar edged higher to 109.21 yen from 109.20 yen. The euro rose to $1.1759 from $1.1761.