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Asian Shares Retreat Ahead Of U.S. Elections, Fed Meeting

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Asian stocks fell across the board on Monday as hopes of an imminent U.S.-China trade deal faded and investors looked ahead to the U.S. midterm elections as well as the Federal Reserve meeting for directional cues.

China's Shanghai Composite Index ended the session down 11.05 points or 0.4 percent at 2,665.43 despite President Xi Jinping praising globalization and China's commitment to free trade.

On the data front, China's private sector expanded at the slowest pace in more than two years in October, with both services and manufacturing seeing weaker performances, survey results from IHS Markit showed today. The Caixin composite output index fell to a 28-month low of 50.5 in October from 52.1 in September.

Hong Kong's Hang Seng Index tumbled 551.96 points or 2.1 percent to 25,934.39. The private sector in Hong Kong continued to contract in October, albeit at a slower pace, the latest survey from Nikkei showed with a PMI score of 48.6, up from 47.9 in September.

Japanese shares fell sharply in thin trading as caution set in ahead of the U.S. midterm elections. The Nikkei 225 Index slumped 344.67 points or 1.6 percent to 21,898.99 after jumping 5 percent last week. The broader Topix Index closed 1.1 percent lower at 1,640.39.

Gaming giant Nintendo gave up 2.7 percent after posting disappointing earnings last week. SoftBank shares ended 0.6 percent higher. After the market close, the company reported second-quarter earnings that topped forecasts.

Bank of Japan Governor Haruhiko Kuroda said the economy has clearly improved and the central bank will consider both positive and negative effects of its monetary policy in a balanced manner going forward.

Separately, domestic demand is expected to continue on an upward trend, while annual inflation is predicted to maintain its gradual climb to the target of 2 percent, the minutes from the Bank of Japan's September meeting revealed.

Activity in Japan's services sector expanded at a faster rate in October, the latest survey from Nikkei revealed, with a PMI score of 52.4, up from 50.2 in September.

Australian markets finished lower to snap a six-day winning streak, with energy and healthcare stocks pacing the decliners. The benchmark S&P/ASX 200 Index dropped 31.10 points or 0.5 percent to 5,818.10, while the broader All Ordinaries Index ended down 0.5 percent at 5,904.80.

Hearing aid maker Cochlear tumbled 3.8 percent after it lost a U.S. patent infringement case. CSL fell 2.4 percent to end lower for the first time in seven sessions.

Energy stocks such as Woodside Petroleum, Santos, Oil Search and Beach Energy declined 1-3 percent as oil prices continued to fall amid signs of rising global supply.

Lender Westpac Banking Corp rose 0.6 percent after reporting a 1 percent rise in annual net profit, in line with expectations. ANZ climbed 1.1 percent and NAB advanced 0.7 percent.

Mining giant BHP Billiton fell 1.2 percent, while Rio Tinto gained 1.6 percent and Fortescue Metals Group jumped 2.4 percent.

Online travel agency Webjet entered a trading halt after it agreed to acquire Dubai-based business travel wholesaler Destinations of the World for A$240 million.

On the economic front, the latest survey from the Australian Industry Group revealed that the service sector in Australia continued to expand in October, albeit at a slower pace, with a PSI score of 51.1, down from 52.5 in September.

South Korean stocks fell amid lingering trade tensions and ahead of the Federal Reserve interest rate decision. The benchmark Kospi closed 19.08 points or 0.9 percent lower at 2,076.92 after surging up 3.5 percent on Friday, its best day in seven years.

Market bellwether Samsung Electronics shed 0.8 percent, chipmaker SK Hynix lost 2.9 percent, steelmaker Posco gave up 3.3 percent and carmaker Hyundai Motor plummeted 5.5 percent.

New Zealand shares fell notably, with the benchmark S&P/NZX 50 Index ending down 56.82 points or 0.6 percent at 8,778.78 after a disappointing outlook from Apple and amid concerns about global trade.

Z Energy shares fell 5.5 percent to extend losses for a third straight session on apprehensions over its revised distribution policy.

U.S. stocks closed lower on Friday to snap a three-day rally as Apple issued a disappointing forecast, the White House dampened optimism over U.S.-China trade talks and a strong jobs report bolstered the case for a Fed rate hike in December.

The Dow dropped 0.4 percent, the S&P 500 shed 0.6 percent and the tech-heavy Nasdaq Composite lost 1 percent.

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