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Asian Markets Mostly Lower

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Asian stock markets are mostly lower on Tuesday, reflecting weakness in technology stocks after the Nasdaq pulled back overnight. Investors are also cautious after talks between British Prime Minister Theresa May and European Commission President Jean-Claude Juncker failed to reach an agreement on the terms of Brexit.

The Australian market is flat following the mixed cues overnight from Wall Street and as investors remained cautious ahead of the Reserve Bank of Australia's monetary policy decision later in the day.

In late-morning trades, the benchmark S&P/ASX 200 Index is down 0.60 points or 0.01 percent to 5,985.00, off a low of 5,948.70 earlier. The broader All Ordinaries Index is losing 1.50 points or 0.02 percent to 6,069.10.

The big four banks - ANZ Banking, National Australia Bank, Commonwealth Bank and Westpac - are lower in a range of 0.1 percent to 0.5 percent.

The major miners are also mostly lower. BHP Billiton is declining almost 1 percent and Rio Tinto is down more than 1 percent, while Fortescue Metals is adding 0.3 percent even as iron ore prices surged above the $70 mark.

South32 has projected lower output and higher unit costs at its Illawarra Metallurgical Coal operations in NSW for 2017-18 after operations at one of the two mines were suspended for an extended period. However, the miner's shares are rising almost 5 percent.

Meanwhile, oil stocks are higher despite the fall in crude oil prices. Santos is edging up less than 0.1 percent, Woodside Petroleum is adding almost 1 percent and Oil Search is rising almost 2 percent.

Gold miners are also higher despite lower gold prices. Newcrest Mining is adding 0.7 percent and Evolution Mining is higher by 0.2 percent.

Key Australian retail stocks have erased earlier losses following news that Amazon has launched in Australia. JB Hi-Fi is now adding almost 1 percent, while Myer Holdings and Harvey Norman are rising more than 1 percent each. Wesfarmers is down 0.6 percent.

Shares of AWE Ltd. are falling almost 15 percent after a Chinese state-owned company formally withdrew it's unsolicited A$430 million bid for the Australian oil and gas company.

On the economic front, the Reserve Bank of Australia is widely expected to keep its benchmark lending rate unchanged at 1.50 percent when it announces its interest rate decision later today.

The Australian Bureau of Statistics said that Australia had a seasonally adjusted current account deficit of A$9.125 billion in the third quarter of 2017. That missed expectations for a shortfall of A$9.0 billion following the A$9.664 billion deficit in the three months prior.

Australia will also see October numbers for retail sales and November results for the Performance of Service Index from AiG today.

In the currency market, the Australian dollar edged higher against the U.S. dollar. In early trades, the local unit was quoted at US$0.7603, up from $0.7597 on Monday.

The Japanese market is declining following the mixed cues from Wall Street and a stronger yen.

In late-morning trades, the benchmark Nikkei 225 Index is declining 120.23 points or 0.53 percent to 22,586.93, off a low of 22,522.28 earlier.

The major exporters are mostly down on a stronger yen. Panasonic is lower by more than 1 percent, Sony is losing 1 percent and Canon is down 0.3 percent, while Mitsubishi Electric is adding 0.6 percent.

In the banking sector, Mitsubishi UFJ Financial is down 0.1 percent, while Sumitomo Mitsui Financial is adding 0.2 percent. Among automakers, Toyota is down 0.6 percent and Honda is declining almost 1 percent.

In the oil space, Inpex is declining almost 1 percent and Japan Petroleum is lower by more than 1 percent after crude oil prices fell overnight.

Among the market's best performers, Nisshin Steel is rising more than 2 percent, Kobe Steel is gaining almost 2 percent and JFE Holdings is adding more than 1 percent.

On the flip side, Sumco Corp. and Nitto Denko are losing almost 4 percent each, while Recruit Holdings is down more than 3 percent.

In economic news, the latest survey from Nikkei showed that the services sector in Japan continued to expand in November, albeit at a slower pace, with a PMI score of 51.2.

That's down from the 26-month high of 53.4 in October, although it remains well above the boom-or-bust line of 50 that separates expansion from contraction. The composite index came in with a score of 52.2, down from 53.4 in October.

In the currency market, the U.S. dollar is trading in the mid 112 yen-range on Tuesday.

Elsewhere in Asia, Shanghai, New Zealand, Malaysia, Hong Kong and Taiwan are also lower, while South Korea, Singapore and Indonesia are higher.

On Wall Street, stocks closed mixed on Monday as traders reacted to news that Senate Republicans narrowly approved a massive tax reform bill early Saturday morning. The Nasdaq pulled back, partly reflecting concerns that technology companies will not benefit as much from the tax cuts.

The Dow rose 58.46 points or 0.2 percent to a new record closing high of 24,290.05, but the Nasdaq tumbled 72.22 points or 1.1 percent to 6,775.37 and the S&P 500 edged down 2.78 points or 0.1 percent to 2,639.44.

The major European markets all moved to the upside on Monday. While the U.K.'s FTSE 100 Index rose by 0.5 percent, the French CAC 40 Index and the German DAX Index jumped by 1.4 percent and 1.5 percent, respectively.

Crude oil futures fell Monday for the first time in three sessions, as a strong dollar dented commodity prices. January WTI oil declined $0.89 or 1.5 percent to settle at $57.47 a barrel on the New York Mercantile Exchange.

by RTT Staff Writer

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