Asian markets mixed as attention turns to US elections

US President Donald Trump. (Evan Vucci, AP, File)
US President Donald Trump. (Evan Vucci, AP, File)

Hong Kong - Asian markets were mixed Tuesday as focus turned to the US midterm elections, which could impact Donald Trump's presidency, while Apple suppliers were hit by reports the tech titan had cancelled plans to ramp up output of its new iPhone.

The US goes to the polls in the first major electoral test for Trump since he took the White House and embarked on an "America First" agenda that has split opinion across the country and globally.

While his tax cuts and deregulation have helped fire the economy and push stock markets to multiple record highs earlier this year, there is a growing concern that his long-running trade row with China is beginning to bite.

The vote has the added twist of an investigation that is looking at whether his campaign colluded with Moscow to win the 2016 election. If the Democrats win both houses of congress, they could push harder for impeachment, fuelling uncertainty.

"These midterm elections carry a sizeable legal risk for the (Republicans) which could dent investor confidence as we will likely hear much more from (Russia probe lead counsel) Robert Mueller sooner rather than later," said Stephen Innes, head of Asia-Pacific trade at OANDA.

In early trade Hong Kong was down 0.2%, having lost more than 2% on Monday, while Shanghai edged down 0.6% and Taipei lost 0.5%.

However, Tokyo was up more than 1% by the break as a weak yen supported exporters, Sydney gained 0.8% and Seoul added 0.4%. Wellington rose 0.5%, Manila put on 0.6% and Jakarta climbed 0.3%.

Apple sours 

Technology firms were among the worst performers, with companies that supply Apple taking a hit after a report in Japan's respected Nikkei business daily said it had told two Taiwan's Foxconn and Pegatron to scrap planned new production lines for the iPhone XR.

Pegatron fell 4% and Foxconn was 0.6% lower while other tech companies were being sold off.

Alps Electric in Tokyo sank more than 1%, Samsung dropped 1% in Seoul and AAC Technologies was more than 7% lower in Hong Kong.

Seoul-listed LG Display was 1.5%lower and Japan Display gave back 3.7%.

Firms linked to Apple were already under pressure after the US giant last week reported weaker-than-forecast iPhone sales and said it would no longer reveal how many it had shifted in its earnings.

Apple shares have fallen almost 10% since Thursday.

Past Tuesday's elections, traders are looking at the Federal Reserve's latest policy meeting, which is not expected to see another interest rate hike but will be followed for clues about its plans for future moves.

Expectations for more rises has pushed the dollar higher against its peers, though the pound is enjoying some buying as hopes grow that officials are close to an agreement on a post Brexit-deal for Britain.

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