Asian shares were on the defensive on Monday as investors grappled with sky-high valuations against the backdrop of a global economy in the grip of a deep coronavirus-induced recession while oil prices dropped.
- Chinese stocks started lower while shares of Hong Kong-listed Semiconductor Manufacturing International Corp (SMIC) plunged to the lowest since June 16 on fears the firm could be added to a US trade blacklist.
- China’s blue-chip index slipped 0.3%.
- Japan’s Nikkei fell 0.2%.
- Australian shares, which had opened in the red, reversed losses to be up 0.1, while South Korea added 0.7%.
- That left MSCI’s broadest index of Asia-Pacific shares outside Japan up a tad after two straight days of losses toppled it from a 2-1/2-year peak last week.
- E-Mini futures for the S&P 500 slipped 0.1% and Nasdaq futures slid 0.7%. US markets will be closed on Monday for the Labour Day holiday.
- Nasdaq futures were dragged lower by the exclusion of Tesla from a group of companies that were being added to the S&P 500.
- In currencies, the dollar was flat against the yen at 106.28 ahead of a heavy week of macroeconomic data with figures on household spending, current account and gross domestic product due on Tuesday.
- The euro held at $1.1838 while the British pound was 0.3% weaker at $1.3241 ahead of a new round of Brexit talks with the European Union on Monday.
In commodities, oil prices dropped more than $1 a barrel, hitting their lowest since July, after Saudi Arabia made the deepest monthly price cuts for supply to Asia in five months.