Asian stock markets are mostly lower on Tuesday following the mostly negative lead overnight from Wall Street amid rising U.S.-China trade tensions and as investors looked ahead to the Federal Reserve's monetary policy decision due on Wednesday. The Fed is widely expected to raise interest rates by another quarter point.
Political uncertainty also weighed on stocks after reports that U.S. Deputy Attorney General Rod Rosenstein was on the verge of resigning or being fired. Meanwhile, the overnight surge in crude oil prices lifted oil stocks.
The Australian market is losing ground following the mostly negative lead from Wall Street. However, energy stocks are among the major gainers after crude oil prices surged overnight.
The benchmark S&P/ASX 200 Index is declining 11.50 points or 0.19 percent to 6,175.40, off a low of 6,166.80. The broader All Ordinaries Index is down 10.20 points or 0.16 percent to 6,289.30.
Oil stocks are advancing after crude oil prices surged overnight. Oil Search is rising 2 percent, Woodside Petroleum is higher by more than 2 percent and Santos is gaining almost 4 percent.
Mining stocks rebounded after falling in the previous session. BHP Billiton is edging up 0.1 percent, Rio Tinto is adding 0.4 percent and Fortescue Metals is rising almost 2 percent.
Among gold miners, Evolution Mining is unchanged while Newcrest Mining is adding almost 1 percent after gold prices rose overnight.
The big four banks - ANZ Banking, Commonwealth Bank, Westpac and National Australia Bank - are down in a range of 0.1 percent to 0.5 percent.
Immutep's shares are declining 2 percent after gaining almost 10 percent on Monday following news that the bio-pharma company signed a deal with Merck and Pfizer to test a cancerous tumor-fighting drug in a clinical trial backed by the two pharma giants.
In the currency market, the Australian dollar is slightly lower against the U.S. dollar on Tuesday. The local currency was quoted at $0.7261, down from $0.7265 on Monday.
The Japanese market is modestly higher after falling in early trade following the mostly negative cues from Wall Street. Investors are cautious after the market's six straight days of gains previously and as they awaited the outcome of Japan's trade talks with the U.S.
The benchmark Nikkei 225 Index is adding 44.09 points or 0.18 percent to 23,914.02, after touching a low of 23,808.95 in early trades. The Japanese market was closed on Monday for a public holiday.
The major exporters are mixed despite a weaker yen. Sony is rising more than 2 percent and Canon is adding 0.5 percent, while Mitsubishi Electric is losing 0.5 percent and Panasonic is down 0.2 percent.
In the banking sector, Mitsubishi UFJ Financial is adding 0.3 percent and Sumitomo Mitsui Financial is higher by almost 3 percent.
Among oil stocks, Inpex is advancing almost 1 percent and Japan Petroleum is gaining almost 3 percent.
Among the major gainers, Nippon Suisan Kaisha is rising more than 4 percent, Shiseido Co. is advancing more than 3 percent and Osaka Gas is higher by almost 3 percent.
On the flip side, Yaskawa Electric is losing more than 6 percent and JXTG Holdings is lower by almost 5 percent. Showa Denko and Suzuki Motor are declining more than 3 percent each.
In economic news, members of the Bank of Japan's monetary policy meeting said that Japan's economic expansion is continuing at an acceptable pace, minutes from the bank's meeting on July 30 and 31 has revealed. At the meeting, the central bank retained its massive monetary stimulus as expected, including the -0.1 percent interest rate on current accounts that financial institutions maintain at the bank.
The Bank of Japan said that producer prices in Japan were up 1.3 percent on year in August, exceeding expectations for an increase of 1.1 percent, which would have been unchanged from the July reading.
Japan also will see August figures for supermarket sales, plus final July results for the leading and coincident indexes today.
In the currency market, the U.S. dollar is trading in the upper 112 yen-range on Tuesday.
Elsewhere in Asia, Singapore, Indonesia and Taiwan are also modestly higher, while Shanghai, New Zealand and Malaysia are lower. The markets in South Korea and Hong Kong are closed on Tuesday for public holidays.
On Wall Street, stocks closed mostly lower on Monday amid news China has canceled trade talks with the U.S. as tariffs on billions of dollars of goods take effect. Traders also were reluctant to make significant moves ahead of Wednesday's Federal Reserve meeting. The Fed is widely expected to raise interest rates by another quarter point.
The Dow shed 181.45 points or 0.68 percent to finish at 26,562.05 and the S&P fell 10.30 points or 0.35 percent to 2,919.37, while the Nasdaq added 6.29 points or 0.08 percent to 7,993.25.
European stocks also fell on Monday. The DAX of Germany dropped 0.64 percent, the CAC of France fell 0.33 percent and the FTSE 100 of the U.K. declined 0.42 percent.
Crude oil prices moved up sharply on Monday, as crude exports from Iran dropped and top oil producers signaled they were in no rush to increase output. WTI crude for November added $1.30 or 1.8 percent to close at $72.08 a barrel on the New York Mercantile Exchange.
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