Political tensions around the world are affecting the markets on Wednesday.
The trade war between the US and China seems to falter, while the talks between the US President Donald Trump and Kim Jong Un, the North Korean leader has been pushed to June 12th.
The first signs of the volatility of this global scenario were shown in the Asian markets. The Nikkei, from Japan, fell down to a low of May 11th, while the yen was rising. The Nikkei 225 closed lower by 1.18%. Australia ASX closed lower by 0.16%.
Others to follow were Chinas SHCOMP down by 1.41%, while the Sensex closed flat at 34.344 which was down by 0.88%. Taiwan was also flat and closed down by 0.48%. Hang Sang fell down by 1.18%.
Nikkei has touched a low of 2 months, as trade tensions were visible. Earlier the Nikkei touched 22,650 before moving on to 22,690 which was a fall of 1.2%. The volatility index of Nikkei jumped up to 16.41, which was a three-week high. Japan’s shippers and steelmakers were the worst hit from trade war worries, as trade would be affected if things were not sorted out between the two powerful countries, the United States and China.
Talks on trade war were on hold, according to Steven Mnuchin, the US Treasury Secretary. Markets hope for better sentiments to happen as nothing is finalized.
In Australia, the energy stocks were down. The sector fell down by 2.5%, taking it to the 2016 lows. Santos fell sharply lower by 8.39%, while OSH was down by 1.87%. In South Korea, Samsung Electronics was able to bring some stability to the market with an increase of 3.06%.
In Hong Kong, the financial and energy sectors were seen leading the fall in its index.
How the situation will be sorted out remains to be seen for market watchers.