Investing.com – Asian equities were mixed in morning trade on Thursday as markets digest the latest developments of the on-again, off-again U.S. trade tensions with key partners.
Overnight, the S&P 500 erased gains that reached 0.9% to finish at the worst level since May 29, while the Nasdaq Composite Index lost 1.3% amid renewed concern that the Trump administration will crack down on Chinese investment.
In Asia, China’s Shanghai Composite and the Shenzhen Component opened 0.2% and 0.4% lower by 9:40PM ET (01:40 GMT). Hong Kong’s Hang Seng Index climbed 0.2%.
U.S. President Donald Trump’s top economic adviser Larry Kudlow said on Wednesday that the president is not retreating on China, although Trump’s plan to crack down on foreign investment is less harsh than many had expected.
The White House announced that it would not be looking to impose the new 25% new limits on Chinese ownership in U.S. tech-related companies, as reports had suggested earlier in the week. Instead, the government would rely on the newly strengthened Committee on Foreign Investment in the United States, or CFIUS, to deal with concerns.
Meanwhile, Treasury Secretary Steven Mnuchin said all of President Trump's advisors were unanimous on the newly unveiled Chinese investment restrictions, which was announced Wednesday morning.
“We are going to treat China the way we are going to treat other people,” Treasury Secretary Steve Mnuchin told reporters. “And to the extent that we were worried about transactions, we will block them. But we are not going to on a wholesale basis discriminate against China as part of a negotiation."
“It’s clearly been acting as a negative on the stock market,” Jeffrey Kleintop, chief global investment strategist at Charles Schwab, said in an interview with Bloomberg on Wednesday. “On days or times during the day like earlier today where trade issues appear to be receding, stocks tend to head higher, and I think ex the trade issues that’s where we’d be going.”
Elsewhere, Japan’s Nikkei slipped 0.4% in morning trade. Australia’s S&P/ASX 200 edged up 0.2%.