Stock market today: Asian stocks mixed as Trump's tariff threats raise uncertainty

Stock market today: Asian stocks mixed as Trump's tariff threats raise uncertainty

Asian Stocks Mixed After Trump’s Tariff Comments Raise Market Uncertainty

Asian stocks were mixed on Wednesday following U.S. President Donald Trump’s recent remarks about tariffs, which caused heightened uncertainty in Chinese markets. Investors had initially been relieved on Monday when Trump chose not to impose significant tariffs on China, but his comments on Tuesday about a potential 10% punitive duty on Chinese imports, citing concerns over fentanyl smuggling, reignited concerns.

Hong Kong’s Hang Seng index dropped 1.1% to 19,888.12, while the Shanghai Composite fell 0.7% to 3,805.78. In contrast, Japan’s Nikkei 225 gained 1.5%, reaching 39,604.71, boosted by Trump’s announcement of a joint venture aimed at investing up to $500 billion in artificial intelligence infrastructure. Softbank Group Corp.'s shares surged by 8.9% on the news.

Taiwan’s Taiex also saw a gain of 1.4%, driven by the AI investment announcement, with Taiwan Semiconductor Manufacturing Corp. rising by 2.7%. South Korea’s Kospi index added 0.7% to 2,535.30, while Australia’s S&P/ASX 200 rose 0.3% to 8,428.70.

U.S. futures were higher, while oil prices showed mixed results. On Tuesday, the S&P 500 climbed 0.9%, reaching 6,049.24, as markets tentatively reacted to Trump’s return to the White House. The Dow Jones Industrial Average rose 1.2% to 44,025.81, and the Nasdaq added 0.6% to 19,756.78.

Despite Trump’s promises to reshape global trade and the economy, many global stock indexes, including those in Asia and Europe, saw only modest moves. The bond market also saw U.S. Treasury yields ease after recent gains, which had put downward pressure on stock markets. Bitcoin pulled back from its recent record high.

In the foreign exchange market, the Mexican peso and Canadian dollar both fell against the U.S. dollar after Trump’s announcement of a 25% tariff on Canada and Mexico, set to take effect on February 1.

The prospect of widespread tariffs, coupled with concerns about policies potentially expanding the U.S. government’s debt, had led to rising Treasury yields, which in turn negatively affected global stock prices. In response, companies would need to deliver stronger earnings growth to maintain stock prices.

U.S. Treasury yields eased, with the 10-year yield falling to 4.56% from 4.62% on Friday, as investors anticipated inflation concerns may remain difficult to subdue. Bond markets had been closed on Monday in observance of Martin Luther King Jr. Day.