Asia markets close mixed after North Korea news; oil extends losses
The Nikkei 225 eked out gains of 0.13 percent, or 30.30 points, to close at 22,481.09 and the broader Topix edged down by 0.07 percent, with the oil subindex falling 4.14 percent amid weakness in oil prices.
South Korea's Kospi rose 0.74 percent to 2,478.96 as weekend developments gave rise to optimism that a U.S.-North Korea meeting in June could take place despite being canceled last week.
Gains in the benchmark came as steelmakers and other manufacturing names advanced: Posco added 2.31 percent and Hyundai Steel jumped 14.48 percent. Large cap technology name, however, finished lower.
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Australia's S&P/ASX 200 also saw losses, finishing down 0.48 percent at 6,004 as declines in energy and materials weighed on the broader index. Woodside Petroleum and Beach Energy tumbled 3.53 percent and 9.59 percent, respectively.
Brent crude futures slid 1.24 percent to trade at $75.49 per barrel and U.S. West Texas Intermediate eased 1.64 percent to trade at $66.77 after settling 4 percent lower in the last session.
"We've been calling for oil prices this year to be relatively range-bound around the mid-$60s level and I think that's a level that OPEC's relatively comfortable with," Hannah Anderson, global market strategist at J.P. Morgan Asset Management, told CNBC's "Squawk Box."
"What they're not comfortable with is prices getting high enough that it made sense for those marginal shale producers to come back online, which is really what drove prices down in the first place in 2015," Anderson said.
Investors also digested geopolitical developments over the weekend, including a meeting between the U.S. and North Korean delegations on Sunday.
The talks on Sunday followed a Saturday meeting between South Korean President Moon Jae-in and North Korean leader Kim Jong Un. That, in turn, came after U.S. President Donald Trump said he canceled a planned meeting with Kim in June last Thursday, although the White House later said it was still making preparations "should the summit take place."
MSCI's broad index of shares in Asia Pacific excluding Japan rose 0.39 percent in afternoon Asia trade.
The gains in Asia followed the mostly lower close stateside on Friday amid a mix of positive corporate earnings releases and geopolitical headlines involving North Korea.
Meanwhile, the euro firmed by some 0.5 percent after news that Italy's president had not approved a nominee for the position of economy minister. The common currency traded at $1.1708 at 3:08 p.m. HK/SIN, compared to Friday's close of $1.1650.
The dollar index, which tracks the greenback against several peers, stood at 93.962. Against the yen, the dollar fetched 109.42.
Italian stocks close 2% in thin trading session; Genmab falls 20%
Meanwhile, Germany's DAX and France's CAC were trading slightly lower at the close. Market holidays in the U.K. and U.S. made trading slow and illiquid on Monday.
The leader of Italy's largest political party called for the country's president to be impeached after choosing to veto a choice for economy minister. Luigi Di Maio of the anti-establishment Five Star Movement said President Sergio Mattarella had prompted an "institutional crisis" by rejecting euroskeptic candidate Paolo Savona.
No major political group has been able to form a majority in Italy since elections in March, leaving the euro zone's third-largest economy without a government.
The euro initially gained ground on the news but soon fell as traders contemplated a political stalemate and another election.
Looking at individual stocks, shares of Genmab tumbled to the bottom of the European benchmark after the Danish biotech company announced it would stop some of its lung cancer trials. Shares of the company slumped 20 percent on the news.
Asian stocks edged higher on Monday, following news Washington and Pyongyang are still working towards holding a summit. MSCI's broadest index of Asia-Pacific shares, excluding Japan, rose 0.2 percent.
Stocks hold weekly gains as solid earnings overshadow geopolitical fears
The Dow Jones industrial average dropped 58.7 points to finish at 24,753.09, led lower by losses in Chevron and Exxon Mobil. The S&P 500 declined 0.24 percent to finish at 2,721.33, amid continued losses in energy and financial stocks.
Both sectors had been under pressure this week as a decline in oil prices weighed on industry leaders like Exxon Mobil and Chevron, which closed down 3.5 percent Friday. Lower interest rates, meanwhile, dragged on bank stocks.
U.S. West Texas Intermediate crude futures fell $2.83, or 4 percent, to settle at $67.88 on Friday after several headlines suggested OPEC and non-OPEC members could increase supply. Russian Energy Minister Alexander Novak met with his Saudi counterpart, Khalid Al-Falih, in St. Petersburg to discuss current output caps.
The move Friday represented WTI crude's worst day since July 2017; oil is off more than 7 percent from recent highs above $72.
The rate on the benchmark 10-year Treasury note has fallen roughly 15 basis points since Monday; it was last seen at 2.93 percent. The Federal Reserve's May meeting minutes released this week showed the central bank may be willing to let inflation run a little hotter than its two percent goal. A pivot to safer asset classes in the wake of geopolitical concerns has also helped send rates lower.
"The other thing I would say concerns the Fed minutes – the Fed blinked. That was the beginning of the downturn this week," he added. "The Fed tried to make up for it up by saying that they would allow inflation to rise above its target ... [but] the Fed never admits to an error."
The Nasdaq composite was largely unchanged between gains in Netflix and Apple and losses in Facebook and Cisco. Trading volume across the U.S. was below its recent trend this week as traders leave Wall Street ahead of the long weekend. Markets will be closed Monday for the Memorial Day holiday.
A string of solid earnings reports helped keep equities on track for weekly gains, as Foot Locker added to the optimism on Friday.
The athletic shoe retailer handily beat Wall Street expectations, posting adjusted earnings per share of $1.45 versus expectations of $1.24 per share. It posted revenue of $2.03 billion, also ahead of estimates.
The company's stock closed 20 percent higher Friday.
"At the end of the day, it's going to come down to earnings and the ability of companies to beat," said Jeremy Klein, chief market strategist at FBN Securities. "Things are quiet ahead of the holiday ... [but] there's nothing to suggest corporate earnings in the next couple quarters will be any less impressive."
Though the Mooresville, North Carolina-based company missed expectations for the first quarter on Wednesday, its stock rose more than 10 percent after it maintained its annual financial targets.
Shares also rallied after famed hedge fund manager Bill Ackman revealed a $1 billion stake in the company; the stock closed up more than 12 percent for the week.
High-end jeweler Tiffany & Co., meanwhile, had one of its best weeks on Wall Street.
The company's stock surged more than 23 percent after reporting that same-store sales rose 7 percentin the quarter, overshooting expectations of only 2.6 percent. It also raised its full-year guidance in light of the solid beat.
The New York-based company suggested its comeback plan is working to retain price-conscious millennial shoppers from drifting to new competitors. The stock closed 2 percent higher Friday, and is up 25 percent this week.
The generally buoyant sentiment following the earnings numbers was tempered after President Trump's abrupt decision to scrap a landmark summit with North Korean leader Kim Jong Un. The meeting would have been the first face-to-face encounter between a sitting U.S. president and a North Korean premier.
In response, Pyongyang's vice foreign minister said the country still hoped for a "Trump formula," before adding the Asian nation would remain open to resolving long-standing issues with the world's largest economy. This helped market sentiment to recover Friday morning with European stocks posting solid gains.
The Stoxx Europe 600 rose 0.1 percent Friday, while the Korean Kospi lost 0.2 percent.
U.S. stocks finished lower on Thursday on the news of the canceled summit in Singapore. The Dow Jones industrial average fell 75 points to finish at 24,811.76 by the closing bell, well off a 280-point drop immediately after Trump's statement.
New orders for U.S.-made capital goods increased more than expected in April, hinting that business spending on equipment was accelerating after a slowdown toward the end of the first quarter.
The Commerce Department said Friday that orders for nondefense capital goods excluding aircraft, a closely watched proxy for business spending plans, jumped 1 percent last month. Economists polled by Reuters had forecast core capital goods orders rising 0.7 percent last month.
Overall orders for durable goods, items ranging from toasters to aircraft that are meant to last three years or more, dropped 1.7 percent in April.