Asian Shares Mixed as US Tariff Concerns Linger
Asian stock markets experienced a predominantly bearish session on Thursday, following a subdued performance on Wall Street. Lingering worries over US President Donald Trump's tariff policies continue to cloud the sentiment among regional investors.
Tokyo's Nikkei 225 witnessed a 1.5% decline to 38,579.71 in morning trading. Australia's S&P/ASX 200 slipped by 1.4% to 8,297.60, while South Korea's Kospi shed nearly 0.5% to 2,659.22.
Hong Kong's Hang Seng index dipped by 1.6% to 22,569.12, after China's central bank maintained its benchmark interest rate, aiming to preserve financial stability. The Shanghai Composite Index lost 0.2% to 3,345.52.
Stephen Innes, managing partner at SPI Asset Management, noted the recent pressure on the Chinese yuan, with foreign-exchange outflows increasing as Trump's tariff rhetoric roiled markets.
On Wall Street, the S&P 500 edged up by 0.2% after setting a fresh all-time high the previous day. The Dow Jones Industrial Average gained 71 points (0.2%), while the Nasdaq Composite Index rose slightly by 0.1%.
Microsoft emerged as a key driver of the S&P 500's modest gain, climbing by 1.3%. The tech giant announced the development of the world's first "quantum processing unit," potentially paving the way for more powerful computers. Despite the relatively small increase, Microsoft's massive market capitalization amplifies its influence on indexes.
Elon Musk's Tesla rose by 1.8%, supported by the decline of rival electric vehicle company Nikola, which plunged by 39.1% after filing for Chapter 11 bankruptcy protection. The truck manufacturer intends to wind down its operations and sell off its assets.
Data released on Wednesday showed that US homebuilders initiated fewer constructions in the previous month than anticipated by economists. High mortgage rates have dampened affordability for potential homebuyers, despite the Federal Reserve's rate cuts since September.
The yield on the 10-year Treasury note eased slightly from 4.55% to 4.53%, moving away from its recent high of 4.80% and below its September level of 3.70%. Both bond and stock markets have gradually adjusted to Trump's tariffs, which initially sparked greater volatility. Market optimism suggests that Trump's threats may primarily be negotiating tactics, with less severe long-term consequences than initially feared.
In energy trading, US crude oil benchmark fell by 32 cents to $71.93 a barrel. International benchmark Brent crude lost 21 cents to $75.83 a barrel. Currency markets witnessed a decline in the US dollar against the Japanese yen, moving from 151.37 yen to 150.60 yen. The euro strengthened against the dollar, rising from $1.0428 to $1.0432.