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Asian Shares Mixed As U.S.-China Tensions Weigh

stockmarkets jan17 27jul20 lt

Asian stocks turned in a mixed performance on Monday as signs that coronavirus infections may be slowing and hopes for a new stimulus deal in Washington offset simmering U.S.-China tensions.

Chinese shares eked out modest gains after official data showed the country's industrial profits increased at a faster pace in June. Industrial profits grew 11.5 percent on a yearly basis in June following a 6 percent rise in May, as easing of the coronavirus containment measures boosted manufacturing activity.

The benchmark Shanghai Composite Index rose 8.46 points, or 0.3 percent, to 3,205.23 despite China reporting its highest number of coronavirus cases in three months.

Meanwhile, Hong Kong's Hang Seng Index dropped 102.07 points, or 0.4 percent, to 24,603.26 on concerns that the economy could take longer than expected to recover.

Japanese shares fell slightly as trading resumed after a four-day holiday. Investor sentiment was dampened after the Tokyo Metropolitan Government reported 239 new coronavirus infections on Sunday, topping 200 cases for the sixth straight day.

However, 131 new cases were reported today, marking the first time in seven days that the capital's single-day tally has totaled fewer than 200.

The Nikkei 225 Index recouped much of the day's losses to end the session down 35.76 points, or 0.2 percent, at 22,715.85. The broader Topix closed 0.2 percent higher at 1,576.69.

Tech stocks such as Advantest, Screen Holdings and Tokyo Electron dropped 1-3 percent, tracking losses in their U.S. counterparts on Friday.

Australian markets edged up slightly, with gold miners surging after Australia took a significant stance in an ongoing maritime dispute over China's attempt to claim ownership of islands and surrounding waters in the South China Sea.

The benchmark S&P/ASX 200 Index inched up 20.20 points, or 0.3 percent, to 6,044.20, while the broader All Ordinaries Index ended up 21.60 points, or 0.4 percent, at 6,169.60.

Evolution Mining, Newcrest and Northern Star Resources surged 3-5 percent after safe-haven gold prices rose to a new record high on Friday.

Mining heavyweight BHP Billiton rose 0.9 percent and smaller rival Fortescue Metals Group added half a percent, while the big four banks ended down between 0.2 percent and half a percent.

In the oil sector, Oil Search, Woodside Petroleum and Santos lost around 1 percent. Fund manager Perpetual entered into a trading half after it agreed to acquire U.S.-based investment management business Barrow, Hanley, Mewhinney & Strauss LLC for $319 million.

Lynas Corp. soared 12 percent after the rare earths producer signed a contract with the U.S. Department of Defense to begin initial work for a heavy rare earth separation facility in Texas.

Seoul stocks ended notably higher as hopes of a stimulus-led economic rebound offset worries over deepening U.S.-China tensions. The benchmark Kospi gained 17.42 points, or 0.8 percent, to finish at 2,217.86.

Market bellwether Samsung Electronics rallied 2.6 percent, internet giant Naver advanced 1.3 percent and steelmaker POSCO added 1 percent.

New Zealand shares closed lower as investors braced for a wild earnings season expected to show the effects of the Covid-19 pandemic.

The benchmark NZX-50 Index dropped 50.64 points, or 0.4 percent, to 11,585.62. Travel-related stocks paced the decliners, with Air New Zealand losing 1.1 percent and Tourism Holdings tumbling 4 percent.

U.S. stocks closed lower on Friday as investor sentiment took a hit over rising U.S.-China tensions and a lack of progress on another round of federal stimulus.

The Dow Jones Industrial Average shed 0.7 percent, the tech-heavy Nasdaq Composite dropped 0.9 percent and the S&P 500 gave up 0.6 percent.

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