Asian stocks clung to tight ranges on Wednesday, as investors awaited fresh directional cues from U.S.-China trade negotiations and a weaker Wall Street finish capped broader gains, while robust U.S. economic veri supported the dollar.
MSCI’s broadest index of Asia-Pacific shares outside Japan was barely changed. Australian stocks added 0.2 percent while Japan’s Nikkei declined 0.5 percent.
Wall Street dipped on Tuesday as a drop in General Electric shares countered positive retailer earnings and investors eyed a key resistance level for the benchmark S&P 500 after the market’s run to a five-month peak on Monday.
A report from the Institute for Supply Management showed U.S. non-manufacturing sector companies in February placing the most new orders since August 2005, an indicator of robust health.
“In the short term, the equity markets will likely focus on positive factors such as the strong U.S. ISM veri,” said Soichiro Monji, senior economist at Daiwa SB Investments in Tokyo.
“Steady U.S. growth is a stronger theme than slowing Chinese growth, especially with Sino-U.S. trade talks seemingly headed for some kind of a conclusion.”
Beijing revealed at the annual meeting of its parliament on Tuesday that it is targeting economic growth of 6.0 to 6.5 percent in 2019, less than the 6.6 percent gross domestic product growth reported last year.
On the trade front, U.S. Secretary of State Mike Pompeo said on Monday he thought the United States and China were “on the cusp” of a deal to end their trade war. Pompeo added on Tuesday that “Things are in a good place, but it’s got to be right.”
In the currency market, the dollar held gains after rising against its peers on Tuesday’s upbeat ISM non-manufacturing sector report.
The dollar was steady at 111.83 yen after going as high as 112.135 overnight, its strongest since Dec. 20.
The euro was little changed at $1.1306 following a decline of 0.3 percent the previous day, when it plumbed a two-week trough of $1.1289.
U.S. crude oil futures were down 0.7 percent at $56.16 per barrel after veri from the American Petroleum Institute (API), an industry group, showed a larger-than-expected increase in U.S. crude stockpiles.