A Bloomberg report on Thursday said that Chinese officials told visitors to Beijing that it will not budge on the thorniest issues and is concerned about the risk that U.S. President Donald Trump could back out of the interim deal.
For the market to slip further, it will require the recent disquiet from the Chinese on trade deals to broaden into something more unsettling, plus a further deterioration in the U.S. economy, both of which seem eminently plausible, said Robert Carnell, head of research, Asia-Pacific at ING.
Thai shares led the fall in the region, with telco and consumer sectors dominating losses on the benchmark. Shares of retailer CP ALL PCL fell 2.6% and telco Advanced Info Service PCL dropped 1.8%.
Malaysian shares <.KLSE> followed suit to slip 0.3% amid broad-based losses. However, the index added 1.5% for the week.
Public Bank Bhd and state-run gas distributor Petronas Gas Bhd shed about 2.4% and 1.6%, respectively.
Indonesia's main index <.JKSE> dipped 0.3% on weakness in consumer and telecom stocks. The benchmark shaved off 0.7% over the week.
Heavyweight Telekomunikasi Indonesia (Persero) Tbk PT slid for third straight session to close at a three-month low after reporting disappointing quarterly results on Wednesday.
Singapore's benchmark <.STI> recovered some of its early losses to end the session flat, but added 1.3% for the week.
Trade-sensitive industrial stocks were the hardest hit, with Jardine Strategic Holdings Ltd dropping 1.3%.
Meanwhile, the Vietnam bourse <.VNI> surged 1.7%, underpinned by real estate stocks. The index added almost 2% this week.
Vietnam has emerged as one of the largest beneficiaries of the trade war between Beijing and Washington, as some businesses are shifting their supply chains away from China in order to avoid tariffs.
Big-cap firms Vinhomes Joint Stock Company and Vingroup Joint Stock Company jumped 7% and 2.9%, respectively.
Philippine markets <.PSI> were closed for a public holiday.
(Reporting by Anushka Trivedi in Bengaluru; Editing by Rashmi Aich)
By Anushka Trivedi