Hong Kong (CNN Business)Asian stocks were mixed Wednesday. Uncertainty about the future of US-China trade relations is still clouding markets.
Hong Kong’s Hang Seng Index (HSI) was down 0.1%, building on losses from earlier in the week. China’s Shanghai Composite Index (SHCOMP) fell 0.5%, while South Korea’s Kospi (KOSPI) ticked up 0.6% and Japan’s Nikkei (N225) inched higher by about 0.2%. The muddled moves followed US stock futures. The Dow (INDU) was up 65 points, or nearly 0.3%, during Asia hours, while the S&P 500 (SPX) and Nasdaq (COMP) also moved higher. All three indexes slumped during trading hours Tuesday as investors worried about recession warning signs in the bond market. The trade war in particular is vexing markets, according to Jingyi Pan, a market strategist for IG Group. She noted that people are “finding it difficult to put a finger as to where the ongoing US-China trade issue is headed.””The saying that we are a tweet away from the next trade escalation between US and China had certainly grown to become the broad view,” she wrote in a research note Wednesday.Read MoreIndeed, US President Donald Trump’s announcement at the start of the month — on Twitter — that he would add new tariffs on China sent markets into a spiral. Stocks have been jittery since then as investors have tried to make sense of seemingly mixed signals on trade progress, coupled with concerns about economic growth.”The Trump premium following China’s supposed ‘its good to talk’ phone call appears to be slowly evaporating as recession fears rise,” wrote Jeffrey Halley, a senior market analyst at Oanda, in a research note. He was referring to Trump’s assertion earlier this week that China called to relay a desire to return to negotiations, which Chinese officials later said they hadn’t heard about. “China’s deafening silence on whether they did or didn’t ring the president isn’t helping either.”Halley added that Asia “will probably dwell” on the recession worries that rattled Wall Street.Asian markets are also generally on pace for a bad month. The Hang Seng has fallen more than 7% in August, putting it on track for its worst month since May. Hong Kong is grappling not just with trade war and slowdown fears, but also with months of mass protests. The Shanghai Composite and the Kospi are both down for the second month in a row. The Nikkei is also lower.