Stocks in Asia Slide, Yen Gains as Risks Pile Up: Markets Wrap

Japanese shares led most Asian stocks lower and the yen appreciated as investors eyed risks from Turkey to North Korea. Treasuries ticked higher, while oil headed lower.

With optimism over U.S.-China trade talks fading from earlier in the week, concerns range from iffy prospects for President Donald Trump’s historic summit with North Korea’s leader to Turkey’s financial-market stability as the lira hits successive record lows. Japan’s currency rose the most in almost three weeks at one point as traders sought a haven, and the Topix index of Japanese stocks fell as much as 1 percent. Equity benchmarks from Hong Kong to Sydney declined. FTSE 100 futures fell in early London trading.

“If you look at history, you find that geopolitics does rattle markets,” Vasu Menon, OCBC Bank vice president, told Bloomberg Television. “The markets are clearly quite nervous because we’ve had a good run and this is an excuse for the markets to take a breather.”

U.S. stocks closed down Tuesday after Trump cast doubt on a meeting with Kim Jong Un during his Oval Office meeting with South Korean President Moon Jae-in. Shares had rallied earlier following China’s announcement that it will cut the import duty on passenger cars, signaling a further easing of trade tensions with the U.S.

Beyond geopolitics, central banks are also in focus this week. The Federal Reserve will release minutes of its latest policy meeting on Wednesday, while the ECB follows suit on Thursday. A raft of U.S. debt sales adds to the busy agenda.

Elsewhere, the New Zealand dollar retreated after the central bank published a discussion paper on unconventional monetary policy.