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Asian stocks mixed after US, Chinese tariff hikes

Asian stocks mixed after US, Chinese tariff hikes

Asian stocks were mixed Monday after Washington and Beijing escalated their trade war with new tariff hikes.

Shanghai advanced while Tokyo and Hong Kong declined. South Korea’s main index was unchanged.

The Shanghai Composite Index gained 0.7% to 2,907.51 and Hong Kong’s Hang Seng lost 0.7% to 25,546.70.

Tokyo’s Nikkei 225 shed 0.2% to 20.653.99.

Seoul’s Kospi was flat at 1,967.76 and Sydney’s S&P-ASX 200 retreated 0.4% to 6,579.20. New Zealand and Taiwan gained while Southeast Asia markets retreated.

Markets reacted less strongly to the weekend tariff hikes on billions of dollars of goods than to previous increases. Investors are hoping for progress in talks this month, but analysts warn the fight over trade and technology is unlikely to be quickly resolved.

“The short-lived truce will probably provide limited relief,” said Zhu Huani of Mizuho Bank in a report. “Businesses have become increasingly uncertain about future prospects, evidenced by the pullback in business investment amidst growing concerns on growth.”

On Sunday, the United States started charging 15% tax on about $112 billion of Chinese imports. China responded by charging taxes of 10% and 5% on a list of American goods.

The two governments say they are going ahead with talks this month in Washington but neither side has given any sign it might offer concessions.

The United States is pressing China to narrow its trade surplus and roll back plans for government-led creation of global competitors in robotics and other industries.