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Asia stocks mixed as US warns N Korea ‘begging for war’

Tuesday 02:50 BST

What you need to know

  • Gold hovers at 10-month high
  • Gasoline prices fall 4%
  • Australian dollar firms ahead of RBA decision

Overview

Asia-Pacific equities were mixed as a nervous tone persisted following North Korea’s latest nuclear test and as the US ambassador to the UN called for further sanctions on Pyongyang.

Hot topic

Nikki Hayley, the US ambassador to the UN, warned on Monday that North Korea was “begging for war” and said the two decades of “half measures” by the UN had failed. But she asked the UN to respond to North Korea’s latest nuclear test with the “strongest sanctions” ever imposed on Pyongyang to “resolve this problem through diplomacy”.

Japanese stocks were under pressure as the yen strengthened, with the Topix index down 0.2 per cent led by a 0.3 per cent fall for financials and consumer staples.

South Korea’s Kospi Composite index dipped 0.1 per cent after retreating from a 0.5 per cent gain earlier in the session. South Korean stocks fell 1.2 per cent in the previous session in the wake of Pyongyang’s nuclear test.

Hong Kong’s Hang Seng was up 0.1 per cent, despite a 0.2 per cent fall for financials, as information technology stocks rose 1 per cent.

Australia’s S&P/ASX 200 was off 0.4 per cent as the financials sector fell 0.5 per cent.

Haven asset gold hovered at a 10-month high at $1,333.39 per ounce after hitting a high of $1,339.81 on Monday, while the Japanese yen gained 0.2 per cent to ¥109.52 as the country’s finance minister called for additional sanctions on North Korea.

Forex

The dollar index, a measure of the greenback against a basket of global peers, was 0.1 per cent lower at 92.585.

The Australian dollar was 0.4 per cent higher against the US dollar at $0.7976 as data showed net exports are expected to contribute more to second-quarter GDP growth than estimated. All eyes were on the Australian currency ahead of the Reserve Bank of Australia’s policy decision later on Tuesday, with the central bank expected to hold rates.

Fixed income

The yield on 10-year US Treasuries was down 2.6 basis points at 2.139 per cent.

Commodities

Oil prices were mixed as the market continued to assess the damage caused by tropical storm Harvey and as refineries restarted.

Brent crude, the international benchmark, was 0.3 per cent lower at $52.17 a barrel while West Texas Intermediate, the main US contract, was up 0.2 per cent at $47.39. Nymex gasoline fell 4 per cent to $1.6790 a gallon.

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