Asian Stocks Rise, Yen Gains as Trump Hints at Softer Tariff Approach

Asian equities surged, led by Chinese stocks, following comments from U.S. President Donald Trump indicating a potential easing of tariff tensions with China. The Japanese yen strengthened after the Bank of Japan raised interest rates.

China Focus

* Chinese stocks in Hong Kong rallied as the dollar weakened and the yuan extended gains.
* Trump stated in a Fox News interview that he preferred not to impose tariffs on the world's second-largest economy.
* Alvin Tan, an FX strategist at Royal Bank of Canada, highlights the volatile nature of the situation, emphasizing that the negotiations may not lead to success.
* Assets associated with China, such as the Australian dollar, also reacted positively, gaining 0.5%.

Bank of Japan Moves

* The Japanese yen strengthened against the U.S. dollar after the Bank of Japan raised interest rates for the first time since July.
* Government bond yields rose to their highest levels since 2008.
* The BOJ anticipates faster inflation in the coming years and signals potential further rate hikes.
* Market participants anticipate Governor Kazuo Ueda's press conference for hints on the pace of future hikes.

Global Market Outlook

* Asian stocks are on track for a second consecutive week of gains, driven by a tech share rebound that propelled Wall Street to record highs.
* MSCI's all-country share index approaches record highs.
* S&P 500 futures remain stable, while the 10-year Treasury yield declines.
* In the U.S., optimism prevails that the administration can strike a balance between growth-boosting measures and inflation control, allowing the Federal Reserve to continue monetary easing.

Corporate News

* Mitsubishi Motors Corp. shares dipped amid reports that it will not participate in Honda Motor Co. and Nissan Motor Co.'s planned merger.

Key Upcoming Events

* Eurozone Manufacturing & Services PMI (Friday)
* U.S. University of Michigan consumer sentiment, existing home sales, S&P Global Manufacturing & Services PMI (Friday)

Market Highlights

* Stocks:
* S&P 500 futures steady
* Japan's Topix flat
* Australia's S&P/ASX 200 up 0.4%
* Hong Kong's Hang Seng up 1.8%
* Shanghai Composite up 0.9%
* Currencies:
* Bloomberg Dollar Spot Index down 0.4%
* Euro up 0.3% to $1.0451
* Japanese yen up 0.6% to 155.13 per dollar
* Offshore yuan up 0.6% to 7.2475 per dollar
* Cryptocurrencies:
* Bitcoin up 1.6% to $104,823.01
* Ether up 3% to $3,346.52
* Bonds:
* 10-year Treasury yield down 2 basis points to 4.63%
* Australia's 10-year yield steady at 4.47%
* Commodities:
* West Texas Intermediate crude flat
* Spot gold up 0.7% to $2,773.24 an ounce