Asian stock markets are mostly lower on Friday despite the positive cues overnight from Wall Street amid reports that the U.S. and European Union may agree to withdraw auto tariffs on each other.
Investors are cautious as U.S. tariffs on $34 billion worth of Chinese imports are set to take effect later in the day. China has said it will respond immediately in equal measure.
The Australian market is modestly higher following the positive cues from Wall Street amid reports that the U.S. and European Union may agree to withdraw auto tariffs on each other. Nevertheless, investors are cautious as the U.S. tariffs on Chinese goods are set to take effect later today.
In late-morning trades, the benchmark S&P/ASX 200 Index is adding 9.70 points or 0.16 percent to 6,225.20, off a high of 6,232.10. The broader All Ordinaries Index is up 8.70 points or 0.14 percent to 6,311.60.
The major miners are higher. Rio Tinto is adding 0.6 percent, BHP Billiton is advancing almost 1 percent and Fortescue Metals is rising more than 1 percent.
In the banking space, ANZ Banking and Westpac are up 0.1 percent each, while Commonwealth Bank is rising 0.3 percent and National Australia Bank is adding 0.4 percent.
Gold miners are mixed despite gold prices rising to a one-week high overnight. Evolution Mining is down 0.6 percent, while Newcrest Mining is higher by more than 1 percent.
Oil stocks are mostly lower after crude oil prices fell overnight. Oil Search is down 0.1 percent and Woodside Petroleum is losing more than 1 percent, while Santos is rising 0.7 percent.
Shares of Domino's Pizza Enterprises are adding 0.4 percent after falling in the previous session as investors dumped the fast food company's stock amid analysts' downgrades.
On the economic front, the latest survey from the Australian Industry Group showed that the construction sector in Australia continued to expand in June, albeit at a much slower pace, with a Performance of Construction Index score of 50.6. That's down from 54.0 in May, although it remains above the boom-or-bust line of 50 that separates expansion from contraction.
The Japanese market is advancing following the overnight gains on Wall Street and on a weaker yen. Investors are digesting news that U.S. President Donald Trump has confirmed U.S. tariffs on $34 billion worth of Chinese imports will take effect as scheduled later in the day.
The benchmark Nikkei 225 Index is adding 185.40 points or 0.86 percent to 21,732.39, off a high of 21,796.07 in early trades.
The major exporters are mostly higher on a weaker yen. Panasonic is adding 0.3 percent, Sony is rising almost 1 percent and Mitsubishi Electric is advancing more than 1 percent, while Canon is down 0.2 percent.
Automakers Toyota and Honda are adding almost 2 percent each. In the banking sector, Mitsubishi UFJ Financial is up more than 1 percent and Sumitomo Mitsui Financial is advancing almost 1 percent.
Among oil stocks, Inpex is adding 0.2 percent, while Japan Petroleum Exploration is losing almost 2 percent after crude oil prices fell overnight.
Among the market's best performers, Eisai Co. is gaining almost 17 percent after the company and Biogen Inc. announced positive topline results from the Phase II study with BAN2401 in patients with early Alzheimer's disease. Mitsubishi Motors and Nippon Sheet Glass are rising more than 4 percent each.
On the flip side, Chiyoda Corp. is losing more than 3 percent, while JGC Corp. and Kajima Corp. are lower by more than 2 percent each.
In economic news, the Ministry of Internal Affairs and Communications said that the average of monthly spending in Japan was down 1.4 percent on year in May, coming in at 281,307 yen. That beat expectations for a fall of 1.5 percent following the 1.3 percent decline in April.
In the currency market, the U.S. dollar is trading in the upper 110 yen-range on Friday.
Elsewhere in Asia, South Korea, Shanghai, Singapore, New Zealand, Hong Kong, Indonesia, Malaysia and Taiwan are all lower.
On Wall Street, stocks closed higher on Thursday as trading resumed following the July 4th holiday on Wednesday. The strength on Wall Street was partly due to easing trade concerns amid reports President Donald Trump might suspend threats to impose tariffs on cars imported from Europe if duties on U.S. cars are lifted.
Positive sentiment was also generated by a report from the Institute for Supply Management showing growth in activity in the U.S. service sector unexpectedly accelerated in the month of June.
The Dow climbed 181.92 points or 0.8 percent to 24,356.84, the Nasdaq jumped 83.75 points or 1.1 percent to 7,586.43 and the S&P 500 advanced 23.39 points or 0.9 percent to 2,736.61.
The major European markets also moved to the upside on Thursday as traders were encouraged by the stronger than expected German factory orders data and easing trade concerns. The DAX of Germany climbed 1.19 percent and the CAC of France rose 0.86 percent. The FTSE 100 of the U.K. gained 0.40 percent.
Crude oil futures fell Thursday after the government reported a surprise increase in U.S. oil inventories. WTI crude fell $1.20 or 1.6 percent to $72.94 a barrel on the New York Mercantile Exchange, easing from a 4-year peak.
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