By Alex Ho
Investing.com - Asian equities traded lower on Wednesday morning after a report suggested that the U.S. would not suspend more Chinese tariffs until after the 2020 U.S. election in November.
China’s Shanghai Composite and the Shenzhen Component dropped 0.6% and 0.5% respectively by 10:30 PM ET (02:30 GMT). Hong Kong’s Hang Seng Index was also down 0.5%.
Existing tariffs on imported Chinese goods are likely to remain in place until November, Bloomberg reported, citing people familiar with the matter said.
The report also said that a phase two deal was not expected before the election.
The news soured investor sentiment and sent global stocks lower today.
“There’s always ‘buy the rumor, sell the news.’ Part of the reason why we had this tremendous, incredible rally last year and especially toward the end of the year, and why we got off to a good start this year, was we had a raft of good news, on earnings, and also on China trade,” said Ed Keon, chief investment strategist at QMA in a CNBC report.
“Stocks are not cheap and any bit of news could have an impact on the market.”
Officials from Beijing and Washington are expected to sign the phase one trade deal, which was agreed in principle in December, later in the day at the White House.
In other news, the People’s Bank of China added 300 billion yuan ($44 billion) through the medium-term lending facility at 3.25%, according to a statement from the central bank.
The measures are expected to help with this year’s earlier-than-usual sale of local government debt.
On the data front, China’s latest GDP report will be out on Friday.
Japan’s Nikkei 225 slid 0.5%, while South Korea’s KOSPI fell 0.3%.
Down under, Australia’s S&P/ASX 200 gained 0.3%.