Japan Stocks trade softer as US tariff deadline nears

The Japan share market declined on Wednesday, 11 December 2019, as investors reluctant to make bold moves on caution ahead of the outcome of the U.S. Federal Reserve's policy meeting later in the day and U.S. trade deadline on Dec. 15 to impose fresh tariffs on Chinese goods. Around late afternoon, the 225-issue Nikkei Stock Average declined 31.22 points, or 0.13%, to 23,378.97, while the broader Topix index of all First Section issues on the Tokyo Stock Exchange eased 4.89 points, or 0.28%, at 1,715.88.

Total 22 issues of the 33 industry category of Topix index dived into negative territory, with Marine Transportation, Banks, Electric Appliances, Pharmaceutical, and Securities & Commodities Futures issues being notable losers, while Electric Power & Gas, Fishery, Agriculture & Forestry, and Iron & Steel issues were notable gainers.

 

Traders remained cautious amid uncertainties surrounding an initial trade deal between the United States and China despite report that President Donald Trump might delay a weekend tariff hike on Chinese goods. As per reports, Trump's advisers were making preparations for to postpone punitive duties on smartphones, laptop computers, toys and other goods, but White House economic advisor Larry Kudlow said tariffs were still on the table.

China and the U.S. have until Sunday to come strike a so-called phase one trade deal. If an agreement wasn't reached by then, new U.S. tariffs will take effect. Tariffs on another $156 billion in Chinese goods are set to go into effect on Dec. 15.

The US-China situation has overshadowed other trade issues, including progress on a new deal involving the US, Canada and Mexico. Democrats in the House of Representatives and the White House announced a revised deal with Mexico and Canada. The deal would replace the North American Free Trade Agreement and would offer more provisions for U.S. workers. The deal includes stronger labor enforcement rules and environmental protections than the pact the Trump administration negotiated with Canada and Mexico last year.

Also in focus for investors this week will be central banks, with policy meetings at the Federal Reserve on Wednesday and the European Central Bank that may offer clues on whether more monetary easing is in store in 2020.

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