Asian markets made modest moves in early trade Wednesday, following a loss on Wall Street when the US Treasury had a further growth curve.
A reverse yield curve indicates investors' concerns about the health of the economy, and has been a reliable indicator of an upcoming recession. On Tuesday, interest rates on US 30-year bonds dipped below them for three-month banknotes, giving a new red flag to the global economy.
NIK, + 0.11%
180721, + 0.86%
gained 0.5% when Japan's downgrade of South Korea's trade status came into force. Trade tensions between the two countries have increased, and in a tit-for-tat move, South Korea's downgrade of Japan's trade status is expected to kick off next month.
Hong Kong's Hang Seng Index
was last approximately flat, while Shanghai Composite
drops 0.3%. Reference indices in Taiwan
Y9999, + 0.45%
JAKIDX, + 0.06%
were mixed. Australia's S & P / ASX 200
XJO, + 0.45%
Among individual stocks was the e-commerce company Rakuten
slipped in Tokyo trade, while IT vendor NEC
6701, + 1.97%
and Tokyo Electric Power
9501, + 2.43%
obtained. In Hong Kong, Sunny Optical
and oil producer CNOOC
883, + 0.91%
increased while Tencent
rejected. LG Electronics
066570, + 1.86%
and Hyundai Motor
005380, + 2.00%
obtained in South Korea, and Foxconn
fell in Taiwan. In Australia, Rio Tinto
RIO, + 2.47%
and Beach Energy
BPT, + 2.68%
Investors "find it difficult to put a finger on where the ongoing US-China trade problem is heading," IG Jingyi Pan said in a report. "The saying that we are a tweet (from Trump) away from the next US-China trade escalation had certainly grown to become the broad view."
On Wall Street, investors moved money from stocks to US government bonds, gold and other traditional safe harbor assets.
UBS, the world's largest wealth manager, recommended customers to reduce stock exposure, the first time the bank has done so since the depth of Europe's debt crisis in 2012.  The benchmark index S&P 500 index
fell 0.3% to 2,869.16. Dow Jones industrial average
fell 0.5% to 25,777.90. Nasdaq
slid 0.3% to 7,826.95.
U.S. and Chinese traders will meet in Washington next month, but neither side has provided any indication of offering concessions to break a deadlock. A round of talks last month in Shanghai ended with no sign of progress.
Washington and Beijing propelled investor pessimism on Friday with an extra round of look-for-tat tolls. Their billions of dollars in penalties on each other's goods have already slammed exporters on both sides and asked forecasters to cut the prospects for economic growth.
"There is no reason to believe that China will conclude an agreement based on unilateral, skewed demands under rising tariff rates," Mizuho Bank said in a report.
Benchmark US crude oil
CLV19, + 1.44%
received $ 56 to $ 55.49 per barrel of e-commerce on the New York Mercantile Exchange. The contract rose $ 1.29 on Tuesday to close at $ 54.93. Burnt crude oil
BRNV19, + 1.06%
used to price international oils, added 41 cents to $ 59.44 per barrel in London. The advanced 91 cents last increased to $ 59.03.
USDJPY, + 0.02%
advanced to 105.84 yen from Tuesday's 105.76 yen.