Asian Stocks were Mixed after Wall Street Hit New Record Highs

One day after shares on Wall Street registered new record highs overnight, the stocks in Asia were mixed.

The Numbers

Mainland Chinese stocks rose at the beginning; however, it shed earlier gains at the end of the day. The Shanghai composite decreased fractionally to about 3,005.04, while the Shenzhen component fell by 0.68% to 10,233.77. The Shenzhen composite declined 0.675% to around 1,697.91.

Hang Seng index of Hong Kong gained 1.18%, in its final hour of trading. Shares of Chinese heavyweight tech, Tencent, observed a growth of around 1.9%.

In South Korea, the Kospi rose 0.29% and close at 2,204.21 as shares of the industry giant Samsung Electronics surged by 1.99%.

Japan’s Nikkei 225 encountered a fall of 0.36% and closed at 23,837.72. The Topix index added 0.11% to finish its trading day at 1,733.18.

According to the data released on Friday, Japanese retail sales data for November was worse than expected. According to government data, retail sales fell by 2.1% in November as compared to that of the last year. That was below a median market forecast for a 1.7% decline, according to Reuters. The data follows a sales tax hike that went into effect in October.

Meanwhile, shares in Australia increased after the Christmas and Boxing Day holidays the S&P/ASX 200 closing at 6,821.70, which is an increase of 0.4%. Overall, shares of MSCI Asia ex-Japan increased by 0.69%.

Stocks on Wall Street experienced new record highs and that too overnight. The Dow Jones Industrial Average rose by 105.94 points to close at 28,621.39, while the S&P 500 added 0.51% to 3,239.91. The Nasdaq Composite finished its trading day with an increment of 0.78% at 9,022.39, topping the 9,000 mark for the first time ever.

Recently, the market sentiment increased since the US and China declared that they have reached a phase one trade agreement earlier in December. The two economic powerhouses are in the middle of translating the deal, intending to sign it in early January.

In a regular press briefing on Thursday, the Chinese Commerce Ministry said China is in close contact with the US on signing the initial trade pact. The statement came after Tuesday, when US President Donald Trump said the deal is “getting done”, adding there will be a signing ceremony with Chinese leader Xi Jinping.

“China has been lukewarm about the trade agreement, expressing less enthusiasm than the US but (Thursday’s) comments is the strongest confirmation to date that there will be no reneging on the deal,” Kathy Lien, Managing Director of Foreign Exchange Strategy at BK Asset Management, wrote in a note dated Thursday.

On the other hand, Adamas Asset Management’s Brock Silvers urged to be cautious because of the lack of details regarding the deal.

“It’s a bit strange that we have an agreement that everyone is trying to celebrate but no one wants to really tell me what’s in it,” Silvers, who is the Managing Director at the firm, told CNBC’s “Squawk Box” on Friday. “I think the market can put up with that for a bit, we can be patient … but after next week … I think there will be some questions”.

The scenario of Currencies and Oil

The Japanese yen traded at 109.50 against the dollar after an early rise of 109.42. The Australian dollar was at $0.6948 after rising from levels below $0.693 yesterday.

Oil prices increased in the afternoon of Asian trading hours, with international benchmark Brent crude futures adding 0.13% to $68.01 per barrel. The US crude futures also gained 0.21% to $61.81 per barrel.

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