Asian stocks fall, oil gives up some gains after China move

June 24, 2018 - 11:52 pm
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BEIJING (AP) — Asian stock markets fell Monday and oil prices gave up some of their gains after Chinese regulators freed up extra money for bank lending amid a trade dispute with Washington.

KEEPING SCORE: Tokyo's Nikkei 225 fell 0.5 percent to 22,404.53 and Hong Kong's Hang Seng lost 0.5 percent to 29,193.68. The Shanghai Composite Index edged up less than 1 point to 2,890.45 while Seoul's Kospi shed 0.4 percent to 2,346.92. Sydney's S&P-ASX 200 retreated 0.1 percent to 6,217.00 and benchmarks in Taiwan, New Zealand and Singapore also declined.

CHINA LENDING: Beijing freed up an about $100 billion for additional bank lending in a move financial analysts said might help to reassure investors rattled by trade tensions with Washington. The cut in the amount of money banks are required to hold in reserve, the second this year, is one of a series forecasters had expected before the dispute over China's trade surplus and technology policy erupted. The central bank said the move is aimed at facilitating debt-for-equity swaps meant to help clear away a backlog of nonperforming bank loans owed by state companies.

ANALYST'S TAKE: "The mixed start to the week for Asian markets appears to be becoming a repetitive theme in recent sessions that saw global equity markets shrouded in the gloom of trade tensions," said Jingyi Pan of IG in a report. "China's latest reserve ratio reduction, while expected, serves as a counterbalance to the soft sentiment."

WEEK AHEAD: The United States is due to report quarterly economic growth on Thursday. On Friday, Japan and South Korea report monthly factory output and the European Union announces June inflation.

CURRENCY: The dollar declined to 109.53 yen from Friday's 109.97 yen. The euro retreated to $1.1651 from $1.1657.

ENERGY: Benchmark U.S. crude fell 19 cents to $68.39 per barrel in electronic trading on the New York Mercantile Exchange. The contract jumped $3.04 on Friday to $$68.58. Brent crude, used to price international oils, dropped $1.37 to $73.95 per barrel in London. It gained $2.52 the previous session to close at $75.32.

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