mainland China stocks ‘Black Monday’ drag asian stocks

Markets in Asia were mixed on Tuesday as the dollar dived on headlines related to U.S. health-care reforms.Markets in Asia were mixed on Tuesday as the dollar dived on headlines related to U.S. health-care reforms.
Japan’s benchmark Nikkei 225 index slid 0.63 percent and South Korea’s Kospi edged down 0.05 percent in early trade.
The S&P/ASX 200 fell 0.98 percent, driven by broader losses across most sub-indexes. The heavily-weighted financials sub-index was down 1.7 percent.
The Hang Seng Index was up 0.14 percent.
Mainland markets were mixed after falling on what some have termed “Black Monday.” The Shanghai Composite was up 0.06 percent and the Shenzhen Composite edged down by 0.233 percent.
Symbol Name Price Change %ChangeNIKKEI —HSI —ASX 200 —SHANGHAI —KOSPI —CNBC 100 —The dollar sank on news that two additional Republican senators had opposed the Republican health-care bill. There are now four GOP senators who have voiced opposition to the bill, which is likely enough to stop it dead in its tracks: The GOP holds 52 seats in the Senate.
The dollar index, which measures the dollar against a basket of currencies, traded at 94.800 at 9:52 a.m. HK/SIN. Against the yen, the greenback fetched 112.22 yen, off levels around the 113 handle seen the last two weeks.
Meanwhile, the euro gained against the dollar to trade at $1.1530.
Investors were now more doubtful over the future of U.S. tax reforms, given the difficulty the health-care bill has faced in making progress, OANDA senior trader Stephen Innes told CNBC. The health-care bill being passed would have added money in the coffers for the government to enact subsequent tax reforms, Innes added.
“The market has a tendency to overreact, but it looks like another nail in the coffin (for the bill),” Innes said.
Markets also continued to digest better-than-expected second-quarter GDP from China released Monday. The Chinese growth rate was 6.9 percent on year compared to the 6.8 percent forecast in a Reuters poll.
Mainland markets stumbled on Monday despite the positive Chinese data, with analysts attributing dampened market sentiment to a financial policy meeting that took place at the weekend. The Shanghai Composite ended the Monday session down 1.4 percent and the Shenzhen Composite fell 4.3 percent.
The strong data is expected to provide a leg of support to commodity markets going forward, ANZ Research economist Giulia Lavinia Specchia said in a Tuesday note.
“Industrial metals were the main beneficiary, but the economic data continues to paint a positive picture for the entire sector,” Specchia added.
Copper prices traded at $6,009.00 a ton, near the four-month high of $6,004.50 hit overnight.
Major mining stocks in Australia traded mixed. Diversified miner BHP traded higher by 0.1 percent, but off highs seen earlier in the session. Iron ore producer Fortescue Metals was up 0.47 percent.
Australia-listed Rio Tinto fell 1.41 percent. The miner announced Tuesday morning it had lowered its iron ore guidance to 330 million tons compared to an earlier range of 330 million to 340 million tons.
In currencies, the New Zealand dollar sank after inflation for the second quarter slowed more than expected. The Kiwi dollar traded as low as $0.7261 compared to a high of $0.7330 seen before the release of inflation data.
The Australian dollar traded at $0.7847 at 9:56 a.m. HK/SIN, above the two-year high of $0.7840 hit earlier in the week.
Meanwhile, the British pound edged down to trade at $1.3078 from the $1.31 handle seen earlier as Brexit talks kicked off. Sterling had traded at a 10-month high at the end of last week.
In energy news, oil prices trended higher after settling down by 1 percent in the last session. Brent crude rose 0.25 percent to trade at $48.54 a barrel and U.S. crude added 0.24 percent to trade at $46.13.
In corporate news, Toshiba announced it would not close a deal on the sale of its memory chip unit before July 28. The company said its current aim is to complete the deal by the end of March 2018. Toshiba shares surged 6.3 percent.
South Korea’s Samsung Electronics announced a partnership with payments platform PayPal to allow for the latter’s use within the Samsung Pay system in the U.S. Users in other countries will be able to access the service “soon,” Samsung said in a statement. The Korean company’s shares rose 0.04 percent.
New home prices in China rose 10.2 percent on year for the month of June, compared to the 10.4 percent rise seen in May. On a monthly basis, June home prices rose 0.7 percent, comparable to the rise seen in the previous month, Reuters said.
A slew of economic data is expected during European hours, with U.K. inflation, PPI and retail prices due at 4:30 p.m. HK/SIN.
Stateside, stocks closed mostly flat as the markets anticipated earnings reports due later in the week.
— CNBC’s Jacob Pramuk contributed to this report.

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