Tokyo stocks opened higher on May 22, tracking gains on Wall Street last week as higher oil prices lifted energy shares. / AFP
HONG KONG, China (AFP) — Asian traders trod carefully Tuesday as profit-taking from the previous day’s rally offset a healthy lead from Wall Street, while the pound briefly fell after authorities said a blast in Manchester could be terror-related.
Global markets pushed higher Monday as energy firms benefited from a surge in oil prices as OPEC and Russia look set to extend an output cut, while US dealers welcomed an optimistic survey on US manufacturing.
But crude was unable to press on with gains Tuesday, weighing on petroleum-linked firms ahead of a meeting between OPEC and Russia later in the week.
With Donald Trump on his first overseas trip, the political crisis that drove huge losses last week has calmed for now.
However, the Washington Post reported that the president had asked two top intelligence officials in March to help push back against a Federal Bureau of Investigation probe into his campaign’s possible links with Russia.
Markets were hammered on fears about Trump’s economy-boosting agenda with his presidency engulfed in a crisis over his firing of FBI chief James Comey and allegations he disclosed sensitive intelligence to Russian officials.
“Thankfully there’s been a pleasant reprieve for the Comey/Trump headlines, but the melodrama is expected to pick up after (US) Memorial Day and (British) Spring Bank Holiday when Trump returns to Washington,” said Stephen Innes, senior trader at OANDA, in a note.
Hong Kong added 0.3 percent, Shanghai slipped 0.2 percent, Seoul was up 0.7 percent and Sydney eased 0.1 percent while Tokyo also gave up 0.1 percent by the break.
On foreign exchanges the pound fell to $1.2974 from close to $1.30 late in New York after police said they were treating as terror-linked an explosion that killed at least 19 people outside a concert in Manchester.
If it is proved to be a terror attack it would be the worst since the London bombers killed 52 people in 2005.
However, sterling later recovered most of its losses.
Traders are now awaiting the release this week of minutes from the Federal Reserve’s latest policy meeting, hoping for some clarity on its plans for hiking interest rates in light of recent disappointing US data while a number of board members will also be speaking.
There was also little initial movement from the release of Trump’s 2018 budget, which proposes billions of dollars in spending cuts over the next 10 years and increased military spending.
Key figures around 0230 GMT
Tokyo – Nikkei 225: DOWN 0.1 percent at 19,653.96 (break)
Hong Kong – Hang Seng: UP 0.3 percent at 25,456.75
Shanghai – Composite: DOWN 0.2 percent at 3,069.78
Euro/dollar: UP at $1.1241 from $1.1239 at 2040 GMT
Dollar/yen: DOWN at 111.09 yen from 111.27 yen
Pound/dollar: DOWN at $1.2993 from $1.2998
Oil – West Texas Intermediate: DOWN four cents at $51.09 per barrel
Oil – Brent North Sea: DOWN six cents at $53.81 per barrel
New York – Dow: UP 0.4 percent at 20,894.83 (close)
London – FTSE 100: UP 0.3 percent at 7,496.34 (close)
© Agence France-Presse