Asian markets fell in early trading Thursday, following Wall Street’s lead as the U.S. and China appeared to brace for a prolonged trade standoff.

After last week’s escalation of tariffs, no new trade talks have been scheduled, and many analysts suspect a breakthrough will require an intervention at the top before the Group of 20 major economies meets next month in Osaka, Japan.

“For a deal, there needs to be a Trump-Xi call, which would enable a useful Lighthizer visit to Beijing,” said Derek Scissors, a China specialist at the conservative American Enterprise Institute. “Then the two leaders could meet in Osaka and compromise on at least one major issue: reinvigorating the talks.”

U.S. Treasury Secretary Steven Mnuchin is talking to Walmart

WMT, +1.10%

  and other companies about finding ways to ease the pain if President Donald Trump goes ahead with plans to extend import taxes to the $300 billion in Chinese products that haven’t already been hit with tariffs, the Associated Press reported.

President Xi Jinping said China must prepare for difficult times, Reuters reported Wednesday, describing a “new Long March,” in which “we must overcome various major risks and challenges from home and abroad.”

Japan’s Nikkei

NIK, -0.82%

  fell 0.8%, and Hong Kong’s Hang Seng Index

HSI, -1.29%

  slid 1%. The Shanghai Composite

SHCOMP, -0.78%

  retreated 0.3% while the smaller-cap Shenzhen Composite

399106, -1.24%

  dropped 0.6%. South Korea’s Kospi

180721, -0.27%

  slipped 0.2%, and benchmark indexes in Taiwan

Y9999, -1.46%

 , Singapore

STI, -0.50%

  and Indonesia

JAKIDX, +1.38%

  were mixed. Australia’s S&P/ASX 200

XJO, -0.32%

  fell 0.3%.

Among individual stocks, SoftBank

9984, -5.68%

  tumbled in Tokyo trading after its U.K.-based ARM unit suspended business with Huawei. Sony

6758, -3.21%

  and Mitsubishi UFJ

8306, -1.22%

  also fell. In Hong Kong, Sunny Optical

2382, -4.83%

 , Tencent

700, -2.30%

  and Country Garden

2007, -2.40%

  sank. SK Hynix

000660, -1.60%

  declined in South Korea, but LG Electronics

066570, +2.74%

  rose. Foxconn

2354, -1.15%

  and Taiwan Semiconductor

2330, -3.15%

  slid in Taiwan. In Australia, BHP

BHP, -1.48%

  and Westpac

WBC, -2.46%


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