Asia stocks backing up in cautionary flare-up, Nikkei 225 back below ¥22,800 as G7 summit approaches

• Asia stocks take a hit as traders recoil ahead of G7 summit meeting.
• Equities are halting as market sentiment sours in Asia-Pacific following missed trade data for Australia and China.

Asia equities are retreating in early Friday trading as markets hesitate and withdraw ahead of the upcoming G7 summit that is sure to deliver tense headlines as US President Trump faces off with leaders of some of the US' closest allies and trading partners.

Friday trading turned down across the board as market sentiment sours ahead of the G7 summit meeting, with investors hesitating following China trade figures that showed an unexpected contraction in the headline Trade Balance figure. 

According to ING chief Asia-Pacific economist Robert Carnell, “It just looks and feels as if, with the weekend looming, and the weekend’s Quebec summit likely to highlight huge rifts between the US and the rest of the G-7 on trade, Iran and the Paris climate accord, investors have decided to play it safe.” Carnell also noted that traders are growing increasingly leery about upcoming statements from the US Fed, European Central Bank (ECB), as well as the upcoming Trump-Kim summit planned for June 12th.

Australia's ASX is mostly flat on the day, down only 0.05%, while Shanghai's Composite is steeply off the day's open, down almost -1.5% with the Hang Seng trading down -1.2%, and the Nikkei off -0.35% for the day.

Nikkei 225 levels to watch

The Nikkei 225 is back into 22,725.00, souring confidence halting the index's climb after staging a recovery from the last swing low at 21,910.00, while May's high of 23,044.00 remains unchallenged.