AFP – Asian markets rose yesterday, tracking gains on Wall Street and following the US Postal Service’s (USPS) U-turn on a ban, though trade war fears continue to dampen sentiment.
Global equities have been hit by volatility this week after US President Donald Trump announced hefty tariffs on Canada and Mexico.
That was followed on Tuesday by news the USPS had scrapped a duty-free exemption for low-value packages from China and Hong Kong.
But it rowed back on Wednesday, saying it would “continue accepting all international inbound mail and packages”.
The news provided traders with some positive mood music to start the day.
Markets in most of Asia were on the rise, with Hong Kong, Shanghai, Seoul and Sydney up more than one per cent.
Tokyo, Singapore and Taipei also rose, though Manila, Mumbai, Bangkok and Jakarta slipped.
However, investors remained on edge about the economic outlook as Trump appeared set to resume the hardball approach to trade and diplomacy seen in his first term.
“Trade War 2.0 is different in terms of coverage as this time round it involves major trading partners of the US,” said OANDA Senior Market Analyst Kelvin Wong. “Hence, countries that have a significant trade surplus with the US will be at risk of being targeted by Trump’s trade tariffs policy; the European Union, Japan, South Korea, and ASEAN export-dependent countries such as Vietnam and Malaysia.
“If trade negotiations are not able to reach the ‘middle ground’ between the US and the targeted countries, tit-for-tat retaliation measures may escalate.”
Ongoing uncertainty about the outlook helped safe-haven gold to a new high above USD2,882.
Disappointing earnings from Google-parent Alphabet weighed on the tech sector, which was already feeling the pinch after DeepSeek released a chatbot it said rivalled those of US tech giants but at a fraction of the cost.
Alphabet tanked more than seven per cent in New York, while Amazon was off more than two per cent. In currency markets, the yen built on its recent gains against the dollar fuelled by expectations the Bank of Japan will continue hiking interest rates as inflation remains elevated.
After raising borrowing costs last month, officials hinted at more tightening down the line, and yesterday top policy board member Naoki Tamura said rates should go up to one per cent the end of the year, from their current 0.5 per cent.
