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Nikkei Markets

Hong Kong stocks slip as Trump fuels trade war uncertainty

CNOOC drops after retreat in crude oil prices on Tuesday

HONG KONG (Nikkei Markets) -- Hong Kong shares ended lower on Wednesday after comments from U.S. President Donald Trump on Sino-American trade relations dampened expectations of an early resolution to the spat.

The Hang Seng Index edged down 0.1% to 28,593.17 after rising 1.8% over the last five trading days. Offshore oil producer CNOOC declined 1.8%, ranking among the biggest contributors to the gauge's losses by points, after Brent crude prices slid 3.2% on Tuesday. Heavyweight mainland lenders China Construction Bank and Industrial & Commercial Bank of China declined 0.5% and 0.4%, respectively.

All three major U.S. equity indexes slipped on Tuesday, coming off record highs, after Trump at a cabinet meeting said the U.S. has a "long way to go as far as tariffs where China is concerned," adding that there are "another $325 billion" of Chinese goods that could be tariffed. The comments come weeks after Trump and Chinese President Xi Jinping agreed at Group of 20 summit in Japan to resume trade talks. The U.S. said it would hold off from imposing more punitive tariffs on Chinese goods.

Trump's comments have "scared" investors, said Jackson Wong, asset management director at Amber Hill Capital. "It is worrying that he is saying the opposite of what he said after the G-20 summit. Still, we do not know if this is a negotiation tactic or for real."

Meanwhile, Federal Reserve Chairman Jerome Powell at a Bank of France dinner in Paris on Tuesday reiterated that the central bank is monitoring downside risks to growth and will act as appropriate. The Fed is widely expected to cut interest rates at its policy review on July 30 and 31.

In the mainland, the Shanghai Composite Index gave up 0.2%. The yuan traded onshore was little changed against the dollar at 6.8774.

Chow Tai Fook Jewellery Group lost 2.6% in Hong Kong after the jewelry retailer's June quarter same-store sales rose 24% in mainland China, but fell 11% in Hong Kong and Macau. Goldman Sachs said the decline in Hong Kong and China was worse than expected, adding that the "weakness indicates a more serious sales deterioration in June versus April to May."

China Shanshui Cement Group rose 2.2% after saying it expects to report a "substantial" increase in profit for the six months ended in June from a year ago.

Shenzhen Investment rose 1.8% following a more than tripling in the Chinese property developer's contracted sales in June.

China Pacific Insurance (Group) edged 0.8% higher after reporting a 6.5% year-over-year increase in gross premium income from its life insurance unit for the January to June period.

DTXS Silk Road Investment Holdings slumped 10.6% to HK$5.80 after saying it agreed to issue 111.2 million new shares at HK$5.3873 apiece to a unit of Hong Kong-listed New World Development. DTXS expects to raise about HK$599 million ($76.7 million) from the issue. New World Development shares added 0.3%.

Power-line communication products maker Risecomm Group Holdings slid 8.5% after saying it expects net loss for the six months ended in June to widen "significantly" from a year ago.

Bonjour Holdings fell 1.2%, extending a 3.3% drop on Tuesday, after the Hong Kong-based cosmetics retailer said it expects to swing to a loss for the six months ended June 30.

-- Amy Lam

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