US-Chinese trade, the Fed, currencies under discussion

Asian markets fell on Thursday as investors worried about ongoing trade tensions between the United States and China.

Mainland China's shares retreated that day, while the Shanghai Composite Index fell 1.36% to about 2,852.52 units, and the Shenzhen component fell 2.56%. at 8,809.53. The Shenzhen composite also fell by 2.432% to about 1,503.37.

Hong Kong's Hang Seng Index lost 1.73% at the last hour of trading.

Elsewhere, the Nikkei 225 in Japan fell 0.62% to close at 21,151.14. The shares of the heavyweight group and conglomerate Softbank Group dropped 5.3% after sources told Reuters that US Justice Department staff had recommended blocking an agreement between T-Mobile and rival Sprint . The Topix index also lost 0.36% to close the trading day at 1540.58.

In South Korea, the Kospi index fell 0.26% to close at 2 059.59, while the Australian ASX 200 fell 0.29% to end its trading day at 6 491.80.

In India, the Nifty 50 rose 0.7% after reaching a new record, the vote count being underway following the national elections. Most polls out of the polls showed that the coalition of outgoing Prime Minister Narendra Modi won the majority.

Investors also continued to monitor developments regarding Chinese telecommunications giant Huawei, which was blacklisted by the United States.

Shares of Huawei's suppliers were hit Thursday by the ongoing fallout.

In Taiwan, contract manufacturing giant Hon Hai Precision Industry – commonly known as Foxconn – and chip maker Taiwan Semiconductor Manufacturing Company both fell more than 3%. In Hong Kong, Sunny Optical, maker of smartphone camera modules and lenses, saw its stock plummet by more than 7%, while Luxshare lost 5.97% in Shenzhen.

"Given Huawei 's size and its integral role in global supply chains, the consequences of US action against Chinese society could be significant, especially if the conflict is to escalate. intensified, "wrote analysts Investec Asset Management.

Overnight, on Wall Street, stocks slid as investors watched the situation evolve between Beijing and Washington in the context of a recent escalation of trade tensions.

US Treasury Secretary Steven Mnuchin told CNBC's Ylan Mui that a trip to Beijing to resume trade talks had not yet been scheduled, thus reducing hopes for a rapid resolution of the trade war.

"The rhetoric has really increased significantly over the past two weeks, obviously not just in the United States." Side … but also Chinese rhetoric, you know, from political circles and of course from the president as well, "said Steve Brice, chief investment strategist at Standard Chartered Private Bank, at CNBC's Squawk Box.

"It's not that it can not be solved, is not it? It may be, but the rhetoric is accentuated and it makes it more difficult, I think, to reach an agreement in the short term, "said Brice.

In the meantime, a report from the US Federal Reserve's May meeting indicated that the central bank would not take any action on interest rates "for a while" even though the economy was improving. .

The US dollar index, which compares the greenback to a basket of peers, was at 98.217 after dipping momentarily below 98.0 yesterday.

The Japanese yen, considered a safe haven currency, traded at 110.18 against a dollar after being strengthened against levels above 110.5 from the previous session. The Australian dollar was at 0.6868 USD after reaching a previous record of 0.6882 USD.

Oil prices fell 0.89% to $ 70.36 a barrel and Brent crude futures fell 0.65% to $ 61.03 a barrel.

– Reuters and Fred Imbert of CNBC contributed to this report.