Asian markets mixed as traders weigh trade tensions vs. hopes of Fed rate cut

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Asian markets were mixed in early trading Thursday as investors weighed pessimism over global trade tensions against optimism that the Federal Reserve would cut interest rates.

Japan’s Nikkei rose 0.3% and Hong Kong’s Hang Seng Index inched up 0.1%. The Shanghai Composite slipped 0.4% and the smaller-cap Shenzhen Composite fell 0.9%. Stocks were about flat in and down in Taiwan . Australia’s S&P/ASX 200 rose 0.6%. South Korea’s Kospi was closed for a holiday.

Among individual stocks, e-commerce company Rakuten jumped in Tokyo trading, while SoftBank and Fast Retailing also gained. Nissan shares fell after a proposed merger between strategic partner Renault SA and Fiat Chrysler fell through. Fiat Chrysler blamed the French government, but the Wall Street Journal reported Nissan declined to support the deal.

In Hong Kong, property companies such as Hang Lung Properties and New World Development rose, while oil producer CNOOC fell, as did Sunny Optical . Taiwan Semiconductor declined in Taiwan, and Rio Tinto fell in Australia.

American and Mexican officials said late Wednesday that progress was being made at immigration talks at the White House, but President Donald Trump tweeted that it was “not nearly enough.”

Trump, who was visiting Ireland, said talks would resume Thursday “with the understanding that, if no agreement is reached, Tariffs at the 5% level will begin on Monday, with monthly increases as per schedule.”

If an agreement isn’t reached, the 5% tax on imports from Mexico will kick in on Monday, adding to costs for American manufacturers and consumers. The tax may eventually increase to 25%.

It is unclear how the U.S. will gauge that Mexico has successfully stemmed the migrant flow from Central America. The Department of Homeland Security announced separately that border arrests reached 132,887 in May, the highest level in more than a decade.

In other news, the U.S. and China concluded their 11th round of trade talks last month with no agreement. No further talks have been arranged.

On Wall Street, broad gains by technology, industrial and health care companies lifted indexes Wednesday. Traders paid little attention to a report showing that private U.S. companies added the fewest jobs in nine years last month. The report may have been seen as positive in that it might encourage the Federal Reserve to cut interest rates.

The Dow Jones Industrial Average , S&P 500 and Nasdaq Composite all rose during Wednesday trading amid rising hopes that the Fed will cut interest rates this year, partly in response to the economic impact of rising trade tensions. Fed fund futures traders now forecast a 72% chance of a rate cut in July.

Benchmark U.S. crude picked up 14 cents to $51.82 per barrel in electronic trading on the New York Mercantile Exchange. It gave up $1.80 to settle at $51.68 a barrel on Wednesday. Brent crude oil , the international standard, added 18 cents to $60.81 per barrel. The contract shed $1.34 to $60.63 per barrel in the previous session.

The dollar slipped to 108.22 Japanese yen from 108.46 yen late Wednesday. The euro strengthened to $1.1231 from $1.1221.