Asian Markets Witness a Mixed Day amidst Escalating Japan-South Korea Tensions
By the end of Friday, Asian markets experienced growth prior to the speech from US Federal Reserve Chairman Jerome Powell, which was scheduled for later in the day.
While the markets of Hong Kong plunged, markets of Shanghai, Tokyo and Australia experienced growth. Amongst other reasons, the prime reason that Powell’s speech was awaited is to look for indications on the interest rates, post the statement of no need for change in interest rates by two regional Fed Presidents.
From the announcement of Powell, the investors are experiencing a rebate in September, which would be the Federal Bank’s second in three months. It is believed that the cut would help to prevent US economic growth from experiencing a fall during the trade war with China.
In Japan, Nikkei 225 experienced a growth of 0.2 percent and closed at 20,672.86. Similarly, the Shanghai Composite Index of mainland China experienced a growth of 0.4 percent to close at 2,894.22. However, it was the Hong Kong’s Hang Seng Index amongst the Asian markets that experienced a plunge by 0.3 percent to close at 26,132.71.
The growth was experienced amidst the soaring tensions between Japan and South Korea, after the latter said that it was dropping the intelligence-sharing pact with Japan. The plan was designed to share information on the perils which could be caused by North Korea and its nuclear activities.
Takeshi Iwaya, Japan’s defence minister, on Friday said that the decision by South Korean government was regrettable and reveals that Seoul is not able to understand the grave threat posed by the North Korean missiles.
Following the announcement, the Japanese and South Korean defence stocks in Asian markets experienced a steady growth. In Japan, while Kawasaki Heavy Industries experienced a growth of 0.69 percent, Fujitsu and Mitsubishi Electric experienced a growth of 1.25 percent and 1.62 percent respectively.
Similarly the South Korean stocks, Speco experienced a growth of 0.17 percent. Apart from Speco, Victek and Hanwa Aerospace experienced growth of 8.49 percent and 2 percent respectively.
Although the further growth of the stocks in the Asian markets depends entirely on statement released by Jerome Powell, to know how the stocks and the trade-war gets influenced will be something we would have to wait for.
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