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Asian shares advance as markets mull North Korea, Italy, oil

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Hong Kong, May 28 (AP) Shares were mostly higher in Asia today as investors digested the latest developments regarding North Korea and Italian politics. Crude oil extended losses as traders braced for output increases.

Japan’s benchmark Nikkei 225 index was nearly flat at 22,445.27 while South Korea’s Kospi rose 0.8 percent to 2,480.92. Hong Kong’s Hang Seng rose 0.7 percent to 30,789.60 but the Shanghai Composite in mainland China climbed 0.2 percent to 3,147.36. Australia’s S&P/ASX 200 fell 0.6 percent to 5,999.90. Taiwan’s benchmark rose and Southeast Asian shares were mostly higher.

President Donald Trump’s latest reversal on a summit with North Korean leader Kim Jong Un and South Korean President Moon Jae-in’s impromptu meeting with Kim on Saturday eased fears over the Korean Peninsula’s nuclear crisis.

Trump tweeted that a US team is in North Korea to make arrangements for the planned June 12 summit in Singapore, days after he said the US was withdrawing from the meeting.

Meanwhile, Moon revealed details about his surprise meeting Saturday 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.”

Italy’s president vetoed populist parties’ choice of a euro-skeptic candidate for economy minister, giving markets some temporary relief. President Sergio Mattarella said on Sunday he was refusing to appoint Paolo Savona, whose views could rattle already nervous markets and further inflate the country’s already staggering debt load. Savona has questioned whether Italy should ditch the euro as its currency.

The development comes 12 weeks after national elections, adding to the country’s political impasse.

“There’s a lot of crossed signals that are coming out. We’ve got slight positive on risk sentiment from Europe but we know that’s very difficult to hold on to, given how emotional Italian politics are,” said Stephen Innes, head of Asian trading at OANDA. On Trump and Kim, “we’ve been down this road many times before, this is a path well worn, and realistically to start chasing risk based on this summit coming back on again could be could be a little bit misguided in the sense we’ve still got a long way to go.”

Oil futures resumed tumbling after taking their worst losses in months on Friday, battered by reports that OPEC countries and Russia could start pumping more oil soon.

Benchmark US crude tumbled $1.99 a barrel to $65.92 a barrel in electronic trading on the New York Mercantile Exchange. The contract dropped $2.83 to settle at $67.88 on Friday.

Trading in Brent crude, used to price international oils, was suspended for a holiday in Britain. Oil producing countries cut output at the start of 2017 following a big supply buildup and agreed last year to extend those cuts through the end of 2018, but according to reports last week, they might agree to start raising production in June.

Major US benchmarks ended little changed on Friday. The S&P 500 index slid 0.2 percent to 2,721.33. The Dow Jones industrial average fell 0.2 percent to 24,753.09. The Nasdaq composite climbed 0.1 percent to 7,433.85.

The dollar edged up to 109.41 yen from 109.40 yen in late trading Friday. The euro rose to $1.1712 from $1.1652.

 

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