Asian shares were mostly lower Tuesday, tracking losses in Europe, where investor confidence was sapped by political uncertainty in Italy. U.S. markets were closed Monday for a holiday.
KEEPING SCORE: Japan’s Nikkei 225 slumped 0.9 percent to 22,280.91 while South Korea’s Kospi was down 0.7 percent to 2,460.75. Hong Kong’s Hang Seng index fell 0.7 percent to 30,590.00. The Shanghai Composite Index sank 0.6 percent to 3,116.59. Australia’s S&P/ASX 200 added 0.2 percent to 6,014.80. Stocks in Taiwan and the Philippines were lower. Many Southeast Asian markets were closed for holidays.
ANALYST’S TAKE: “Italian politics dominated overnight as the geographical divide between northern Europe wealth and Southern Europe economic struggles play out in the emotionally charged Italian political front,” said Stephen Innes of OANDA. “Things appear to be moving in a positive tangent in North Korea, and given the all the noise this ruckus has created over the past fortnight, global markets are happy to see this summit happen.”
ITALIAN POLITICS: Italy’s president vetoed a euroskeptic candidate for economy minister proposed by leaders of two populist parties that were trying to form a government. President Sergio Mattarella said Sunday he was refusing to appoint Paolo Savona, whose policies could rattle nervous markets and further inflate the country’s staggering debt load. Instead, he named an economist, Carlo Cottarelli, to lead the country until new elections. While avoiding a populist government that investors had worried about, the move means more political uncertainty.
NORTH KOREA: Reports that officials from the United States and North Korea are in Singapore and South Korea for meetings raised hopes they were resuming planning of a possible summit. Trump tweeted that a U.S. team is in North Korea to make arrangements for the planned June 12 summit in Singapore, days after he said the U.S. was withdrawing from the meeting. Meanwhile, Moon revealed details about his surprise meeting with Kim in the Panmunjom truce village, saying Kim had committed to sitting down with Trump and to a “complete denuclearization of the Korean Peninsula.”
EUROPEAN MARKETS: France’s CAC 40 fell 0.6 percent to 5,508.93 on Monday and Germany’s DAX dropped 0.6 percent to 12,863.46. Italy’s benchmark FTSE MIB opened higher but drifted lower to close down 2.1 percent at 21,932.69. British markets were closed for a bank holiday.
ENERGY: Benchmark U.S. crude plunged $1.07, or 1.6 percent, to $66.81 per barrel in electronic trading on the New York Mercantile Exchange. The contract settled at $67.88 per barrel, down $2.83, on Monday. It dropped 4 percent on Friday, battered by reports that OPEC countries and Russia could start pumping more oil soon. Brent crude, used to price international oils, added 32 cents to $75.64 per barrel in London.
CURRENCIES: The dollar slipped to 109.06 yen from 109.42 yen while the euro gained to $1.1628 from $1.162.
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