Asian Markets Rally Following U.S. Tariff Reversal
HONG KONG (AP) – On Thursday, Asian stock markets largely mirrored gains from Wall Street after U.S. President Donald Trump backed off plans for tariffs on eight European nations. He also dismissed the idea of using military force to obtain Greenland.
The S&P 500 inched up by less than 0.1% on Thursday, while the Dow Jones Industrial Average saw a nearly stagnant change.
In Japan, the Nikkei Stock Average climbed 1.7% to reach 53,688.89 yen, driven by technology shares. Notably, SoftBank Group surged by 11.6%, while Disco Corporation soared by 17.1%. Advantest, known for its chip-testing equipment, also saw a rise of 5%.
In South Korea, traders cheered as the Kospi index crossed the 5,000 yen threshold for the first time, closing at 4,952.44, a gain of 0.9%. The technology sector led this surge, with semiconductor maker SK Hynix’s shares increasing by 2%, and Samsung Electronics rising by 1.9%.
Hong Kong’s Hang Seng saw a slight uptick of less than 0.1%, hitting 26,600.68. Meanwhile, the Shanghai Composite Index moved up 0.1% to settle at 4,122.58.
In Australia, the S&P/ASX 200 climbed nearly 0.8% to reach 8,848.70.
Additionally, Taiwan’s Tyex appreciated by 1.6%, while India’s Sensex experienced a minor increase of 0.2%.
In earlier U.S. trading, the market recorded significant losses, partly due to Trump’s earlier threats of tariffs creating investor anxiety. His comments about a potential 10% customs duty on countries like Denmark, Norway, and Germany had previously raised alarms regarding cooling U.S.-European relations. Trump’s harsh rhetoric had many worried.
However, during a speech at the World Economic Forum in Davos, Switzerland, he clarified that he would not use force to obtain Greenland and announced a deal with NATO leadership to address “a future trading framework” concerning Greenland and Arctic security.
This easing of tensions boosted investor sentiment on Wall Street. On Wednesday, the S&P 500 rose by 1.2%, closing at 6,875. The Dow also went up by 1.2% to $49,077.23, and the Nasdaq Composite Index increased by 1.2% to $23,224.82.
In the corporate world, Halliburton shares increased by 4.1% after exceeding profit expectations for its latest quarter. United Airlines also climbed by 2.2% following similarly positive quarterly results. On the flip side, Netflix saw its stock drop by 2.2%, even after reporting better-than-expected profits, as investors were primarily concerned about a slowdown in subscriber growth.
Gold prices dipped by 0.2%, settling at $4,828.70 an ounce, as investor anxiety lessened post-Trump’s remarks on Greenland, which had previously driven many towards this safe-haven asset.
In the bond market, U.S. bond yields also retreated, calming investor concerns as instability in Japan’s bond market subsided. The yield on the 10-year U.S. Treasury note fell to 4.25% from 4.30% observed on Tuesday.
This week, Japan’s long-term government bond yields spiked after Prime Minister Sanae Takaichi announced a snap election for February, raising fears that proposed tax cuts and increased spending might hinder efforts to control national debt.
The U.S. dollar strengthened against the yen, rising to 158.75 from 158.27. Analysts noted that further weakening of the yen might provoke intervention from authorities.
The euro also experienced a gentle rise, moving to $1.1692 from $1.1687.
Meanwhile, benchmark U.S. crude oil prices fell by 16 cents to $60.46 a barrel, while Brent crude, the international benchmark, dipped by 24 cents to $65 a barrel.
