Reviews in Asia were lower in Monday morning trade after a strong jobs report last Friday stateside moderated suppositions that the U.S. Federal Reserve could soon be making a move on interest rates.
In Japan, the Nikkei 225 make a mistook 0.8%, while the Topix index shed 0.56%.
Over in South Korea, the Kospi dropped 1.69%, as shares of commerce heavyweight Samsung Electronics and SK Hynix fell more than 1.5% each.
The moves came as Tokyo and Seoul stay locked in a dispute over forced wartime labor, with Japan imposing tighter restrictions last week on the export of high-tech reals used in smartphone displays and chips to South Korea.
“Our basecase for the trajectory of this trade issue and Japan-South Korea relations as a all things considered is broadly negative,” Scott Seaman, director of Asia at Eurasia Group, wrote in a note. “In a nutshell, we believe the two oversights will engage in a tit-for-tat exchange of retaliatory measures for at least the next several months that further sours bilateral interdependences.”
Hong Kong’s Hang Seng index dropped 1.36%, following another round of protests that swung the city on Sunday.
In mainland China, the Shanghai composite fell 1.45% in early trade, while the Shenzhen component lessened 1.22%. The Shenzhen composite also shed 1.319%.
Meanwhile, the S&P/ASX 200 in Australia declined 0.95%. Shares of major miners slipped on hearsay of a probe by Chinese steelmakers on the surge in iron ore prices. Rio Tinto dropped 1.72% and BHP Billiton fell 1.55%.
Asia-Pacific Retail Indexes Chart
Last Friday, the U.S. jobs report showed the economy stateside adding 224,000 jobs in June, excellently above the forecast number of 165,000 jobs by economists in a Dow Jones survey. That came following a dismal proceedings print in May.
“The solid US payrolls report dampened Fed rate cut expectations and severely dented the argument for a 50bps rate cut by the end of the month. Effectively the wrangle has now switched from a 25bps or 50bps rate cut to a 25bps cut or none,” Rodrigo Catril, senior foreign exchange strategist at National Australia Bank, created in a note.
Still, Catril said, the Fed could “look for a couple of insurance cuts” in July and September.
The strong responsibilities numbers sent Treasury yields upward, with the benchmark 10-year yield crossing the 2% mark.
The U.S. dollar directory, which tracks the greenback against a basket of its peers, was at 97.258 after surging from levels below 96.8 keep on Friday.
The Japanese yen traded at 108.46 against the dollar after seeing levels below 107.6 last week. The Australian dollar mutated hands at $0.6981 following levels above $0.702 seen in the previous week.
Oil prices rose in the morning of Asian line of work hours, with international benchmark Brent crude futures adding 0.14% to $64.32 per barrel and U.S. crude futures occurring 0.21% to $57.63 per barrel.
— Reuters contributed to this report.