Most Asia markets declined on Wednesday, tracking Wall Street's negative close overnight, with resources and financial shares losing ground. Investors also remained vigilant amid U.S.-North Korea tensions and the nearing of the French presidential election. Stocks in Japan erased early losses, with the Nikkei up 0.20 percent and the Topix edging up 0.18 percent. Australia's shares were also lower, with the S&P/ASX 200 down 0.43 percent. Hong Kong's Hang Seng Index shed 0.47 percent, while on the mainland, the Shanghai Composite was off 0.37 percent and the Shenzhen Composite lost 0.34 percent. In South Korea, the Kospi shed 0.36 percent. U.S.-North Korea tensions lingered. Vice President Mike Pence, arriving in Tokyo from South Korea, reassured Japan of American commitment to reining in North Korea's nuclear and missile ambitions on Tuesday, after warning that U.S. strikes in Syria and Afghanistan showed the strength of its resolve. The reclusive North has conducted a series of missile and nuclear tests in defiance of U.N. sanctions. Some analysts weren't overly concerned by the market declines. "We are going through a technical correction and the market needs that because it's been rising the past five months already," Norman Chan, chief investment officer at Oreana Private Wealth, told CNBC's "Squawk Box" on Wednesday. Chan pointed to a host of positive data from China, particularly the strong gross domestic product (GDP) figures released earlier this week. He noted that the mainland's economic improvement would help to boost other Asian economies as they export to China. In Australia, some resources plays were lower, with BHP off 0.23 percent and Newcrest down 1.04 percent. In a note on Tuesday, Citi reiterated a bearish view on iron ore, although it raised its forecast for 2017 to $70 a tone from $65. The bank cited risks for the second half of this year, including the slowdown of Chinese steel demand growth, large-scale restarts of Chinese iron ore mines, and stronger Indian supply growth due to cancellation of export tariffs on low-grade ores. Additionally, Morgans said in a research note on Tuesday that it was downgrading Newcrest shares to Hold from Add, citing a "large seismic event" at its Cadia East mine last week, with the bank assuming a two-month production interruption. It noted that Cadia accounted for 31 percent of the company's total production and 49 percent of the group's earnings before interest, tax, depreciation and amortisation (Ebitda). In Japan, the commodity trading houses were lower, with Itochu shedding 1.53 percent and Mitsubishi Corp. losing 1.74 percent. Shares of Sharp surged 6.41 percent and Toshiba tacked on 4.62 percent. Kyodo News cited a Sharp executive as saying the company was considering investing in Toshiba's memory-chip business, Dow Jones reported. Financial stocks around the region were lower, after Goldman Sachs earnings missed the mark and as bond yields fell amid as markets turned cautious and U.S. economic data disappointed. In Australia, Westpac shed 1.16 percent, Japan's Mitsubishi UFJ was off 1.27 percent and South Korea's Hana Financial was down 1.33 percent. In Hong Kong, HSBC shed 0.56 percent and in Singapore, shares of DBS fell 1.16 percent. Hong Kong-listed Geely Auto tacked on 2.64 percent after it launched earlier this week a Lynk & Co. brand SUV, which it plans to sell in China, North America and Europe. Daiwa upgraded the stock to Buy from Outperform in a note on Tuesday, saying it expected the Lynk brand would help further improve profitability. The bank raised its 2018 and 2019 earnings per share forecasts by 7-19 percent. European equities fell broadly after U.K. Prime Minister Theresa May overnight called for a snap election in June. The announcement also sent the British pound on a wild ride. The currency rose sharply after initially falling as low as $1.2520 on word that May would make an important announcement. After the announcement the pound rose as high as $1.2904 on Tuesday. On Wednesday, it was fetching $1.2841 at 7:59 a.m. HK/SIN. Naeem Aslam, chief market analyst at Think Markets, said in a note on Wednesday that the rally on the surprise snap election may be premature. "Traders are getting well ahead of themselves," he said. "Theresa May could easily win the upcoming election according to the latest polls. However, this doesn't not mean that Brexit negotiations with the EU partners would become easy," he added, noting "it is the EU which would be very much calling the shots." Aslam also noted that May's lead could fade before the June 8 voting as the election could be seen as an opportunity for opponents to derail Brexit. The dollar index, which measures the greenback against a basket of currencies, tumbled to 99.475 by 7:33 a.m. HK/SIN from levels over 100 overnight after weaker-than-expected housing starts, which fell 6.8 percent last month, compared with expectations for a 3.9 percent decline. "The Beige Book is scheduled for release on Wednesday and while the U.S. economy in general continues to recover, if Fed districts report a slowdown, the dollar could extend its losses quickly," Kathy Lien, managing director of foreign-exchange strategy at BK Asset Management, said in a note late Tuesday. The Dow Jones industrial average fell 113.64 points, or 0.55 percent, to close at 20,523.28, the S&P 500 fell 0.3 percent dropped 6.82 points, or 0.29 percent, to end at 2,342.19 and the Nasdaq pulled back 7.32 points, or 0.12 percent, to close at 5,849.47. Source: CNBC
