Asian shares mostly slip after U.S. markets were closed for a national holiday

Asian shares mostly declined Tuesday as some investors took a wait-and-see attitude after U.S. markets were closed for a national holiday.

Some investors were also disappointed after a meeting between Chinese leader Xi Jinping and Secretary of State Antony Blinken yielded no signs of progress from either side on Taiwan, human rights, technology and other issues of contention.

Japan's benchmark Nikkei 225 inched down less than 0.1% in afternoon trading to 33,388.91. Australia's S&P/ASX 200 added 0.9% to 7,357.80. South Korea's Kospi lost 0.2% to 2,603.27. Hong Kong's Hang Seng dipped 1.8% to 19,550.76, while the Shanghai Composite edged down 0.5% to 3,240.87.

The Chinese government said the meeting between Xi and the top U.S. diplomat produced “candid and in-depth” talks. Bilateral relations are at their lowest point in decades. Both sides indicated a willingness to cooperate.

“There is no doubt China and the U.S.A. need each other, and their relationship to be back on a more secure footing for mutually beneficial commercial reasons, as well as reducing the risk of actual conflict,” Clifford Bennett, chief economist at ACY Securities said in a commentary.

The Chinese economy is recovering at a slower pace than expected from the disruptions caused by efforts to vanquish COVID-19, leading the central bank to cut its benchmark 1-year loan prime rate on Tuesday by a tenth of a percentage point to 3.55%.

The 5-year rate was lowered to 4.2% in a move to help ease credit and encourage spending and investment to boost economic activity.

“Recent easing moves suggest that reopening efforts are losing their shine, setting the groundwork for more policy intervention to follow in the months ahead,” Yeap Jun Rong of IG said in a commentary.

U.S. markets were closed for the Juneteenth national holiday. Markets are also watching the direction of interest rate hikes.

Last week, the Federal Reserve held its benchmark lending rate steady, the first time in 10 straight monthly meetings it hasn’t announced an increase. The Fed warned it could raise rates as often as two more times this year.

In energy markets, benchmark U.S. crude lost $1.02 to $70.76 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, declined 26 cents to $75.83 a barrel.

In currency trading, the U.S. dollar edged up to 142.07 Japanese yen from 141.91 yen. The euro cost $1.0931, up from $1.0921.