Asian shares slipped Friday as investors awaited a speech by Federal Reserve chair Janet Yellen later in the day. South Korea's Kospi fell 1.1 percent on worries that deployment of a U.S. missile defense system will hurt ties with China, its largest trading partner.
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KEEPING SCORE: Japan's Nikkei 225 index fell 0.5 percent to 19,469.17 while South Korea's Kospi sank 1.1 percent to 2,078.75. Hong Kong's Hang Seng index lost 0.6 percent to 23,584.39 and the Shanghai Composite Index lost 0.4 percent to 3,216.90. Australia's S&P/ASX 200 dropped 0.8 percent to 5,729.60. Stocks in Taiwan, Singapore and other Southeast Asian countries were also lower.
FED WATCH: Fed Chair Janet Yellen is scheduled to give a speech in Chicago later Friday. Her speech, along with jobs data next week, will give more clues to investors on the Fed's movement. Expectations are high that the Federal Reserve will raise interest rates this month. U.S. jobless claims fell to the lowest level in decades last week, strengthening the belief that the central bank is moving closer to achieving its full employment and inflation targets, analysts said.
WALL STREET: U.S. stocks pulled back from record highs on Thursday as pushed down by banks and other financial companies. The Dow Jones industrial average lost 0.5 percent to 21,002.97. The Standard & Poor's 500 index fell 0.6 percent to 2,381.92. The Nasdaq composite index slid 0.7 percent to 5,861.22.
ANALYST VIEWPOINT: "U.S. markets were seen snapping back into a state of caution after touching fresh highs on Wednesday. Asian markets look set to step in line with overnight markets, joining the slide," Jingyi Pan of IG said in a commentary. She said investors were focusing on Yellen's speech.
SOUTH KOREA: Investors dumped shares in South Korean companies that rely on trade with China out of concern Beijing may retaliate over the deployment of an advanced U.S. missile defense system. China strongly opposes to the anti-missile system that the U.S. and South Korea say is needed as a defense against North Korea. Cosmetics company Amorepacific, which has major business in China, sank 10 percent. Tourism companies also fell.
CHINA CONGRESS: Shares in Hong Kong and Shanghai slipped ahead of the opening of National People's Congress' annual session. While the largely ceremonial legislature is expected to steer clear of dramatic reforms, leaders may announce new measures to rein in debt and tighten oversight of financial markets.
JAPAN ECONOMY: Inflation and jobless rates were little changed in January and consumer spending was lackluster. Economic data released Friday show the world's No. 3 economy coasting along with only slight improvements despite recent stronger exports and manufacturing output.
OIL: Benchmark U.S. crude added 10 cents to $52.71 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.22, or 2.3 percent, to close at $52.61 a barrel on Thursday. Brent crude, used to price international oils, gained 10 cents to $55.18 a barrel.
CURRENCIES: The dollar fell to 114.16 yen from 114.42 yen. The euro rose to $1.0520 from $1.0508.