SYDNEY (Reuters) - Asian shares stepped back from a 2-1/2 month high on Friday as risk appetite soured on bets that Europe’s massive monetary stimulus was nearing an end, compounded by uncertainty over trade relations ahead of a key meeting of global leaders.
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.5 percent after six straight sessions of gains took it to the highest since mid-March.
Chinese shares slipped, with the blue-chip Shangai-Shenzhen index .CSI300 down 0.6 percent. Hong Kong's Hang Seng .HSI declined 0.7 percent while South Korea's KOSPI was off 0.4 percent.
Japan's Nikkei .N225 and Australian shares were barely changed.
The European Central Bank will debate next week whether to end bond purchases later this year, the bank’s chief economist said on Wednesday, a hawkish message that sent the euro to a three-week top, hit emerging markets, and spurred demand for safe-haven bonds.
“Markets are having to rediscover how to price risk amid reduced central bank buying and that adjustment could prove very hard,” said Matt King, Citi’s global head of credit strategy.
Another major reason for the nerves was the widening rift between the United States and its major trade partners after President Donald Trump imposed import tariffs on steel and aluminum imports last week.
Trump seemed in no mood to reconcile when he tweeted, just one day before a Group of Seven summit, that France and Canada imposed “massive tariffs” on their imports from the United States and had non-monetary barriers to trade.
The summit takes place on Friday and Saturday in Charlevoix,
