Asian markets dropped on Wednesday, with Hong Kong leading losses, after President Donald Trump's remarks fueled worries about US-China trade tensions ahead of talks between the two countries.
Hong Kong's Hang Seng Index ( briefly tumbled 1.4% to its lowest level in three weeks. It recovered some of those losses to trade 1% lower by early afternoon, still underperforming other major indexes in the region. )
Japan's Nikkei ( fell 0.4%. South Korea's )Kospi ( dropped 0.7%. China's )Shanghai Composite Index ( also lost 0.6%. )
President Trump lashed out at China's trade practice in a UN speech on Tuesday and said he won't accept a "bad deal."
"Not only has China declined to adopt promised reforms, it has embraced an economic model dependent on massive market barriers, heavy state subsidies, currency manipulation, product dumping, forced technology transfers and the theft of intellectual property and also trade secrets on a grand scale," Trump said.
Wang Yi, China's Foreign Minister, rejected the criticisms in a speech in New York. He said the United States should not try and change China and there will be "endless troubles" if the United States and China disengage, according to a statement by the Foreign Ministry.
Top trade representatives from China and the United States are expected to meet in Washington in early October to discuss trade. Investors had hoped for an interim trade deal and a cooling of trade tensions.
The trade chaos took a toll on US markets, with the Dow (, )S&P 500 ( and the )Nasdaq Composite ( all closing lower. Stocks were also hit by political turmoil around an impeachment inquiry into President Trump stemming from the Ukraine whistleblower case. )
Shares of oil producers also tumbled in Asia, with crude futures ending lower on Tuesday after reports that Saudi Arabia has restored most of its oil output. The country will return to full production next week, according to Reuters.
PetroChina, Asia's largest oil and gas producer, fell 1.9% in Hong Kong, while its Shanghai-listed stocks also dropped 1.3%. CNOOC, China's largest offshore oil producer, moved down 1.1% in Hong Kong.
Inpex, Japan's top oil and gas company, lost 0.9% in Tokyo.
On the oil market, US crude fell 0.6% to trade $56.94 per barrel on Wednesday. Brent crude, the global benchmark, dropped 0.7% to $62.64 per barrel.
- Maegan Vazquez and Anneken Tappe contributed to the report