The markets in Asia slip between the political certainty in the United States

By | September 27, 2019

Asia markets traded lower Wednesday afternoon as investors watched for developments in the United States after lawmakers launched an impeachment inquiry into President Donald Trump.

The Shenzhen composite shed 1.214%. Hong Kong’s Hang Seng index also fell 0.95%.

In Japan, the Nikkei 225 slipped 0.44% as shares of index heavyweights Softbank Group and Fanuc fell 2.58% and 2.59%, respectively. The Topix index also declined 0.27%.

Over in South Korea, the Kospi shed 0.74%. Australia’s S&P/ASX 200 also declined 0.36%.

The MSCI Asia ex-Japan index traded 0.74% lower.

U.S. House Speaker Nancy Pelosi announced the inquiry after meeting with key leaders in the House committee and the Democratic leadership team.

Tuesday’s announcement came after reports about a phone call earlier this year between Trump and Ukraine’s leader, Volodymyr Zelensky. The U.S. president allegedly pressured Zelensky to investigate Democratic presidential hopeful Joe Biden’s family. Trump said on Tuesday he would release the full transcript of the controversial call.

Just three American presidents before Trump have faced serious impeachment proceedings, but Congress has never booted one from the White House. Even if Democrats eventually impeach Trump, the Republican-held Senate may never find him guilty and remove him from office.

The move also triggered a sell-off in U.S. equities overnight: The S&P 500 saw its largest one-day drop since August 23, falling 0.8% to close at 2,966.60. The Nasdaq Composite also had its worst day in a month, ending its trading day lower by 1.5% at 7,993.63. The Dow Jones Industrial Average closed 142.22 points at 26,807.77.

As of Wednesday morning stateside, futures pointed to a muted open for stocks on Wall Street at Wednesday’s open.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 98.504 after slipping from levels around 98.700 yesterday.

On the trade front, Trump said Tuesday that he will not accept a “bad deal” with Beijing, ahead of negotiations between the two largest economies of the world set to take place in the coming weeks. Chinese Foreign Minister and State Councilor Wang Yi responded to Trump’s criticism and said the two economic powerhouses should cooperate for mutual gain as well the rest of the world.