Beijing, China (BBN) – Asian markets fell on Tuesday, tracking slight declines in the US overnight, as traders await a monetary policy decision from the Reserve Bank of Australia (RBA).
In Australia, the ASX 200 dropped 0.23 per cent, with most sectors trading lower, reports CNBC.
The heavily-weighted financial subindex was down 0.42 per cent as shares of major Australian banks slipped — ANZ declined 0.22 per cent, while the Commonwealth Bank fell 0.49 per cent and Westpac was down 0.41 per cent and the National Australia Bank dipped 0.42 per cent.
The Australian dollar traded at $0.7606 at 9:50am HK/SIN, dropping from levels above $0.7650 reached in the previous week.
The RBA is set to announce its monetary policy decision at 2:30pm local time, where economists mostly expect the central bank to keep the cash rate at a record low of 1.50 per cent.
“The RBA Board Meeting is unanimously expected to be on hold, though markets will be paying close attention to the post meeting statement,” said Tapas Strickland, an economist at the National Australia Bank.
He added the central bank has little appetite to ease policy further given concerns over “creating fragilities in household balance sheets” and also it was more optimistic on the global economy.
Strickland said the April statement could, however, have a slight dovish tone, given the ongoing softness in the labor market and Monday’s soft retail numbers.
In Japan, the Nikkei 225 fell 0.38 per cent, retracing some of its early trade declines of 0.7 per cent, while across the Korean Strait, the Kospi was down 0.12 per cent.
Chris Weston, chief market strategist at spreadbettor IG, reckoned Tuesday’s trade had a “distinct risk-off vibe, although the moves in equities are probably best described as a ‘drift’, rather than a ‘spike’ lower.”
In the currency market, the dollar traded at 100.47 against a basket of currencies at 9:54am HK/SIN, climbing from levels below 99.60 reached in the previous week but dropping from levels near 100.60 earlier this week.
“The dollar index has, for three straight sessions, tried and failed to trade above its 50-day moving average, last located around 100.67,” said analysts at Singapore’s DBS Bank in a Tuesday note.
Among major currency pairs, the yen traded at 110.65 to the dollar, strengthening from levels above 111.0 and likely will put pressure on Japanese export stocks.
Japanese export stocks, particularly automakers, were under pressure in morning trade. Shares of Toyota declined 1.04 per cent, Nissan was down 2.57 per cent and Honda fell 2.48 per cent.
Meanwhile, Toshiba shares dropped 9.29 per cent.
On Monday, Reuters citing sources said the troubled Japanese conglomerate would likely miss a third deadline to report its quarterly business results.
Among other currency pairs, the euro traded at $1.0667, while the British pound fetched $1.2485.
Oil prices traded flat on Tuesday morning during Asian hours, following an overnight decline.
Global benchmark Brent traded at $53.11 a barrel, while US crude was at $50.24 at 10am HK/SIN.
Reuters reported that Libya’s Sharara oil field, the country’s largest, resumed production on Sunday following a one-week disruption.
The field was producing around 120,000 barrels per day on Monday and about 220,000 bpd prior to the March 27 shutdown.
More broadly, investors this week will be eyeing the meeting between Chinese President Xi Jinping and President Donald Trump on April 6 where the two leaders will have no shortage of weighty issues to discuss — including trade and North Korea among others.
“There is justifiable tension/apprehension building over the meeting between Presidents Trump and Xi this week as the former’s China bashing over alleged mercantilist policies presumably sets the stage for what could be testy talks,” said Vishnu Varathan, a Singapore-based economist at Mizuho Bank.
Varathan noted fears of “collision course” are overdone and reckoned the two leaders will find “face-saving, ‘win-win’ deals to showcase.”
Markets in China and Taiwan remained shut on Tuesday for a public holiday.