Asian stocks bounced back on Tuesday following U.S. President Donald Trump’s decision to postpone trade tariffs on Canada and Mexico, easing immediate market concerns. However, caution remained as investors awaited the impending tariffs on Chinese imports.
Asian Stocks Recover Amid Tariff Delay
Regional equities regained lost ground after steep declines on Monday, triggered by Trump’s initial tariff announcement. U.S. stock index futures also turned higher in Asian trade after Wall Street closed lower on Monday.
Trump had announced a 25% tariff on imports from Canada and Mexico and a 10% levy on Chinese goods, effective February 4. However, following discussions with Canadian and Mexican officials, he agreed to postpone the tariffs on Mexico and Canada by 30 days.
This delay has temporarily eased concerns about an escalating trade war and the potential disruptions to global supply chains. Markets are also optimistic that the extended timeline could allow for further negotiations, reducing short-term uncertainty.
Market Performance Across Asia:
Japan: Nikkei 225 jumped 1.5%, while TOPIX rose 1.4%.
South Korea: KOSPI climbed 1.8%, rebounding from its lowest level since early January.
Australia: S&P/ASX 200 gained 0.4%.
Philippines: PSEi Composite surged 2%.
India: Futures for Nifty 50 indicated a marginal rise at open.
Thailand: SET Index fell 0.8%, bucking the regional trend.
Hong Kong Stocks Surge on AI Optimism
Despite the looming Chinese tariffs, Hong Kong stocks surged, fueled by investor enthusiasm surrounding artificial intelligence (AI) developments. AI-related firms saw strong inflows as markets reacted positively to recent innovations in the sector.
Chinese Markets Await Reopening
Chinese markets remained closed for the Lunar New Year holiday and are set to resume trading on Wednesday. Meanwhile, U.S. tariffs on Chinese imports remain on schedule for implementation later in the day.
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Conclusion
The delay in tariffs on Canada and Mexico has provided some relief to Asian markets, but investors remain cautious about the upcoming Chinese trade levies. With market volatility expected, leveraging data-driven insights can help navigate investment opportunities in an evolving economic landscape.
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