Asian shares mixed, South Korea advances as calm returns

A South Korean dealer working in KEB Hana Bank in Seoul, South Korea, on Aug 11, 2017.
A South Korean dealer working in KEB Hana Bank in Seoul, South Korea, on Aug 11, 2017. PHOTO: EPA

SYDNEY (BLOOMBERG) - Asian stocks began trading mixed on Wednesday (Aug 16) after an uninspiring US session that saw the US dollar grind higher, with attention turning away from geopolitics and back to economic data.

Markets are settling down after a tumultuous few days spurred by heightened tensions between the US and North Korea. South Korean shares climbed as traders returned from a holiday. The latest data showed American consumers splurged in July, dragging Treasuries lower and buoying the greenback. Gauges of volatility in the US and Japan continued a retreat as calm returned to stock markets.

Japan's Topix index was little changed. South Korea's Kospi index rose 0.9 per cent, reopening after a holiday.

Australia's S&P/ASX 200 Index retreated 0.2 per cent.

Futures on the S&P 500 Index were little changed as of 9:07am in Tokyo. The S&P 500 and the Nasdaq Composite closed down 0.1 per cent on Tuesday and the Dow Jones Industrial Average gained five points, or less than 0.1 per cent.

The revival in US retail sales bolsters prospects that growth will accelerate in the second half, the latest clue on the strength of the world's largest economy ahead of minutes from the Federal Reserve's most recent meeting, due to be published on Wednesday. Policy makers have been flagging they may announce plans to reduce the central bank's balance sheet in September and then potentially raise interest rates again this year.

The Bloomberg Dollar Spot Index jumped 0.4 per cent on Tuesday as the yen, pound and kiwi weakened.  The yen rose 0.1 per cent on Wednesday to 110.62 per dollar and the Aussie was up a similar amount to 78.27 US cents.

The yield on 10-year Treasuries held at 2.27 per cent after climbing five basis points on Tuesday.

Gold added 0.1 per cent to US$1,272.57 an ounce in early Wednesday trading after declining 0.8 per cent the previous session.

West Texas Intermediate added 0.3 per cent to US$47.69 a barrel. It has declined almost 5 per cent this month.