Asia follows Wall St lower as US and Chinese foreign ministers meet

Wall Street’s S&P 500 index lost 0.4% on Friday after the Federal Reserve held its benchmark interest rate steady, but last week warned it could be raised later if needed to cool inflation.

On Sunday, Secretary of State Antony Blinken and Chinese Foreign Minister Qin Gang, what the Chinese government called, held candid, in-depth and constructive talks at a time when relations are at their lowest point in decades. They indicated a willingness to work together on important issues, but failed to indicate any progress on disputes over Taiwan, human rights, technology and security.

Whether that will lead to actual positive results remains to be seen, IG’s Yeap Jun Rong said in a report. Any passivity on that front could eventually lead to a slumber of optimism.

The Shanghai Composite Index lost 0.3% to 3,262.59 and the Nikkei 225 in Tokyo lost 0.3% to 33,591.82. The Hang Seng in Hong Kong fell 0.6% to 19,915.51.

The Kospi in Seoul fell 0.8% to 2,605.46 while the S&P-ASX 200 in Sydney gained 0.4% to 7,277.70. New Zealand, Singapore, Jakarta and Bangkok also fell.

On Friday, the S&P 500 fell to 4,409.59, but closed a fifth straight weekly gain. It’s close to a 14-month high after rising 15% this year.

The Dow Jones Industrial Average fell 0.3% to 34,299.12. The Nasdaq index fell 0.7 percent to 13,689.57 points.

Humana fell 3.9% for one of the S&P 500’s biggest losses after becoming the latest health insurer to warn of rising costs due to pent-up demand for medical services. Health insurer UnitedHealth previously issued a similar warning.

Last week, the Fed held its benchmark lending rate steady, not announcing a hike for the first time in 10 consecutive monthly meetings.

However, the Fed warned that it could raise interest rates twice more this year. Wall Street is betting on a rate hike at its next meeting on July 25 and 26.

A survey on Friday suggested that US consumers are also adjusting their expectations for upcoming inflation. The preliminary reading of the University of Michigan study also suggested that consumer confidence is improving more than expected.

Chemical company Cabot slumped 8.1% after it said weak demand globally, and especially in China, will hurt earnings this year.

Software maker Adobe rose 0.9% after reporting solid financial results and raising its earnings forecast.

In the energy markets, benchmark US crude lost $1 to $70.93 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.16 to $71.78 on Friday. Brent crude, the price base for international oil trading, fell $1.16 to $75.45 a barrel in London. It gained 94 cents to $76.61 the previous session.

The dollar rose from 141.80 yen to 141.93 yen on Friday. The euro fell from $1.0943 to $1.0939.