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Tokyo, Japan (BBN) – Asia markets were mostly lower in afternoon trade on Tuesday, as Australia’s central bank met expectations by keeping its cash rate unchanged.

Trading in Asia followed a mixed overnight session in the US that nevertheless saw the Dow Jones industrial average notch a record closing high, reports

Australia’s ASX 200 finished down 13.76 points, or 0.23 percent, at 5,971.82. The heavily-weighted financial subindex was lower by 0.49 percent.

The country’s so-called Big Four banks were under pressure, with ANZ losing 0.99 percent, Commonwealth Bank down 0.23 percent, Westpac lower by 1.09 percent and the National Australia Bank declining 0.37 percent.

In Japan, the Nikkei 225 fell 84.78 points, or 0.37 percent, to 22,622.38. The Topix index turned positive and added 4.1 points, or 0.23 percent, to 1,790.97. Across the Korean Strait, the Kospi gained 8.45 points, or 0.34 percent, to 2,510.12.
Hong Kong’s Hang Seng index was down 0.53 percent in afternoon trade. On the Chinese mainland, the Shanghai composite finished down 6.57 points, or 0.2 percent, at 3,303.04 while the Shenzhen composite fell 35.92 points, or 1.88 percent, to 1,866.98.
“Markets … look to be taking their lead from the likelihood of Congress agreeing on tax cuts and, last night, another positive U.S. economy data print,” David de Garis, director of economics and markets at the National Australia Bank, wrote in an early morning note.
He pointed out the market will be paying “close attention to not only the headline print for ISM Non-manufacturing but what it might say about Friday’s payrolls from its employment component.”
Meanwhile, Wei Liang Chang, a foreign-exchange strategist at Mizuho Bank, wrote in a morning note that the “failure in the U.S. equity rally, and a retreat in [10-year Treasury] yields back below 2.4 percent suggest that tax reforms had already been partially expected, while new uncertainties related to investigations into [President Donald] Trump are also weighing” on the market.
The Reserve Bank of Australia kept its cash rate unchanged at a record low of 1.5 percent during its December policy meeting.
The move was largely in line with expectations. In a statement, RBA Governor Philip Lowe said while global economic conditions have improved over the course of the year, labor markets have tightened and wage growth remains low in many countries along with core inflation.
Lowe said in Australia, he expects wage growth to remain low for “a while yet, although the stronger conditions in the labor market should see some lift in wage growth over time.”
The statement added that the central bank expects the Australian economy to grow on average around 3 percent over the next few years, with an improved outlook for non-mining business investment and increased public infrastructure investment.
Paul Bloxham, chief economist for Australia and New Zealand and global commodities at HSBC, told CNBC’s “Street Signs” the central bank didn’t really introduce any new themes in its latest statement.
“The only thing that I noticed … is that they’re talking a little bit more about the labor market tightening up and about the fact that that’s starting to show up in business surveys,” Bloxham said, adding that businesses are saying it’s getting harder to get skilled workers.
HSBC expects the RBA to start raising the cash rate around the middle of next year.
In the currency market, the dollar traded at 93.145 against a basket of rivals at 3:07 p.m. HK/SIN, climbing from an earlier session low of 93.035.
Among currency majors, the Japanese yen traded at 112.59 to the dollar. The Australian dollar rose to $0.7647 at 3:07 p.m. HK/SIN, from an earlier low of $0.7593, following the central bank’s largely-expected decision to keep its cash rate on hold.
The euro traded at $1.1873, rising from an earlier low of $1.1860. Meanwhile, the British pound traded at $1.3439 at 3:09 p.m. HK/SIN, falling from an earlier high of $1.3482.
Overnight, the meeting between British Prime Minister Theresa May and European Commission President Jean-Claude Juncker failed to yield an agreement on the terms for Brexit between the U.K. and the European Union.
Oil prices traded roughly flat in the afternoon session on Tuesday, with U.S. crude trading at $57.46 a barrel. Global benchmark Brent traded down 0.13 percent at $62.37 at 3:10 p.m. HK/SIN.
Analysts at Singapore’s OCBC Bank said in a note that crude oil prices fell overnight “likely on profit-taking amid a stronger dollar.”
Last week, OPEC and oil giant Russia agreed to extend production cuts until the end of 2018 to tackle a supply glut in the energy market.
In the news: Aussie retailers shrug off Amazon entry
US e-commerce giant Amazon officially launched its Australian operations that are expected to tighten competition in the country’s retail space. But that did not stop most Australian retailers from finishing the Tuesday session higher.
Shares of department store chain Myer were up 1.3 percent and wholesaler Metcash gained 3 percent. Supermarket giant Woolworths fell 0.11 percent. Meanwhile, Harvey Norman shares jumped 6.25 percent and JB Hi-Fi rose 6.76 percent.
Amazon’s entry into Australia was highly anticipated, but Harvey Norman Chairman Gerry Harvey said it fell short of the hype.
“The hype was just unbelievable,” Harvey told CNBC. “Whenever you get that hype, inevitably, you find … this has turned into a lame duck. And it is a lame duck.”
Harvey added that he expects the Australian retail giant to have “a wonderful Christmas.”
“Amazon will not affect us one iota. I think it will help us because they are having these cyber Mondays and Black Fridays, and every time they do that, it drives more people into the Harvey Norman shops,” he said. “Even when we don’t advertise on those days, our sales go up 50 to a 100 percent because the dotcoms are out there, the onliners, advertising and they’re actually sending the people into our shops.”
Meanwhile, Australia’s seasonally adjusted retail sales for October saw a 0.5 percent jump according to the country’s Bureau of Statistics, beating forecasts. There were increases across all industries, led by a 1.7 percent increment in cafes, restaurants and takeaway food services.
That followed a 0.1 percent rise in September.
“Interestingly, housing related spending growth continues to moderate suggesting the softening housing cycle is having an impact,” Jo Masters, a senior economist at ANZ, wrote in a note.
Masters said she sees “headwinds for discretionary spending” due to the challenging combination of weak wage growth, record indebtedness, a rise in prices for non-discretionary goods and services and the slowing house price growth and rising petrol prices.
Elsewhere, the country’s current account deficit decreased to 9.1 billion Australian dollars ($6.95 billion) in the September quarter.