Asia stocks subdued; Australia drops as weak Westpac earnings weigh

Investing.com-- Asian stock markets were subdued on Monday, as Australian shares dropped after weak Westpac earnings dragged financials, while other markets saw only slight gains as investors awaited clarity on U.S.-China trade talks.

Major regional markets, including Japan, China, Hong Kong, and South Korea, were closed for their respective public holidays, leading to thin trading volumes in the region.

U.S. stock index futures fell in Asian trading on Monday as investors cautiously awaited the crucial Federal Reserve policy meeting, starting later this week.

Markets were also awaiting a slew of Chinese datapoints this week, especially China’s monthly trade data, to assess the implications of U.S. tariffs.

Westpac HY earnings drag Aussie shares lower

Australia’s S&P/ASX 200 fell 0.7% on Monday, led by a decline in banks. The financials sub-index S&P/ASX 200 Financials dropped 1.6%.

The country’s no. 2 mortgage lender, Westpac Banking Corp (ASX:WBC), on Monday reported a 1% decline in net profit due to tighter lending margins offsetting growth in its loan portfolio.

The lender also noted global trade risks fueled by U.S. tariffs, saying they have made future economic forecasts less clear.

Westpac shares fell more than 3% in early trading.

In other news, the Australian Labor Party on Saturday secured a second consecutive term, held against a backdrop of surging housing prices and uncertainty over U.S. President Donald Trump’s trade policies.

Investors seek clarity on US-China trade talks

China on Friday said it was evaluating the possibility of trade talks with the U.S., stating that any dialogue must be based on sincerity and the removal of unilateral tariffs.

The Trump administration has also reached out to China to initiate trade talks, media reports showed last week.

These developments eased concerns of an all-out global trade war, but investors still awaited clearer signs and official announcements on potential tariff negotiations.

Singapore’s Straits Times Index inched 0.1% lower.

Futures for India’s Nifty 50 also edged down 0.1% amid geopolitical tensions with Pakistan.

The Philippines’ PSEi Composite index fell 0.3%, while Malaysia’s KLCI index edged 0.2% higher.

Indonesia’s Jakarta Stock Exchange Composite Index rose 0.4%.

China trade balance, CPI, PMI data awaited

China’s Caixin services PMI report for April is due on Tuesday, while the country’s trade balance and consumer price index (CPI) inflation data will be released on Friday.

“We suspect the shock on Chinese US-bound exports will be significant, causing a double-digit year-on-year decline in both exports and imports,” ING analysts said in a recent note.