Wednesday 22nd January 2025: Asia-Pacific Markets Mixed as Trump Signals New Tariffs on China

Global Markets:

•  Asian Stock Markets : Nikkei up 1.72%, Shanghai Composite down 1.15%, Hang Seng down 1.5% ASX up 0.33%
• Commodities : Gold at $2769.35 (0.26%), Silver at $31.5 (0.8%), Brent Oil at $79.29 (-0.19%), WTI Oil at $75.74 (-0.03%)
• Rates : US 10-year yield at 4.586, UK 10-year yield at 4.5885, Germany 10-year yield at 2.4770

News & Data:

• (CAD) CPI m/m  -0.4% vs -0.7% expected
• (CAD) Median CPI m/m  2.4% vs 2.5% expected
• (CAD) Trimmed CPI m/m  2.5% vs 2.5% expected

Markets Update:

Asia-Pacific markets showed mixed performance on Wednesday as Chinese stocks declined following President Donald Trump’s remarks about imposing a 10% tariff on China. Australia’s S&P/ASX 200 gained 0.26%, while Japan’s Nikkei 225 and Topix rose 1.36% and 0.87%, respectively. South Korea’s Kospi surged 3.67%, and the Kosdaq climbed 0.93%. Several Korean tech stocks rallied, with SK Hynix up 2.52% and LG Electronics rising 2.85%, following reports that Korean firms are considering relocating production from Mexico to the U.S. in response to Trump’s protectionist policies.

Meanwhile, Hong Kong’s Hang Seng index dropped 1.34%, and mainland China’s CSI 300 fell 0.85% after Trump stated that a 10% tariff on China could take effect as early as February 1. In India, the Nifty 50 rebounded 0.28% after hitting its lowest level since June, while the BSE Sensex rose 0.46%. Investors are also focused on Malaysia’s central bank meeting, where the Bank Negara Malaysia is expected to keep its policy rate steady at 3%.

In the U.S., stock markets ended higher as investors interpreted Trump’s trade comments as slightly softer than anticipated. The Dow Jones Industrial Average surged 537.98 points (1.24%) to close at 44,025.81, while the S&P 500 gained 0.88% to finish at 6,049.24. The Nasdaq Composite rose 0.64% to 19,756.78, reflecting investor optimism despite ongoing trade concerns.

Trump also suggested imposing a 25% tariff on Mexico and Canada starting February 1 due to border issues. Additionally, he hinted at potential tariffs on China if the country does not approve a TikTok deal. These developments continue to shape market sentiment and global trade expectations.

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