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Nikkei Markets

Asian equities edge lower amid uncertainty over US-China trade

Great Wall Motor and Singapore Exchange among losers on A300

HONG KONG (Nikkei Markets) -- Asian shares outside of Japan edged lower on Tuesday as investors awaited developments on the U.S.-China trade negotiations ahead of a deadline for American tariffs on more Chinese goods.

The Nikkei Asia300 Index of companies outside Japan ended 0.1% lower to 1,309.80.

Asian equities struggled for direction as traders were reluctant to make bets just days ahead of the deadline for imposing U.S. tariffs on additional Chinese shipments. Tariffs on more than $150 billion of Chinese imports could take effect on Dec. 15 if an interim deal is not reached between the two countries.

While officials from both the sides said that talks were progressing well, U.S. President Donald Trump recently said that he was in no hurry to sign a deal and the matter could drag on till after the 2020 U.S. presidential elections. Last Friday, Trump's top adviser reaffirmed the Dec. 15 deadline and said and the president would make a final decision on whether to go ahead with the new tariffs.

Jingyi Pan, a market strategist at IG Asia, said if a deal is not reached by Dec. 15, "the bare minimum" that investors will want is a delay in the new tariffs. The lackluster performance of Asian equities on Tuesday was "unsurprising," considering the event risk the deadline poses.

Meanwhile, investors digested China's inflation data released Tuesday that showed that consumer prices rose by the most in eight years in November. Economists said that the data was not likely to affect China's monetary policy as the 4.8% year-on-year increase was primarily due to food inflation and demand-side price pressures remaining subdued.

China's November activity and spending data are due next Monday. Economists polled by Reuters expected retail sales growth to have rebounded to 7.6% from 7.2% in October, and industrial output growth is pegged at 5% compared with 4.5%.

Among movers on the A300 on Tuesday, Great Wall Motor fell 2.2% after the Chinese automaker's November sales volume dropped 13.1% on-year.

Singapore Exchange declined 1.4% despite the bourse operator saying that the total securities market turnover value increased 22% in November from a year earlier.

Compal Electronics slid 0.8% after the Taiwanese notebook computer maker reportedly said that November sales declined 9.4% year-on-year. United Microelectronics advanced 1.2% following a 20% rise in sales.

--Nimesh Vora

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