On Tuesday, Asian markets and U.S. futures showed signs of recovery, driven primarily by a significant upturn in Tokyo's Nikkei 225 index. This resurgence came after some calm returned to global markets following the turbulence caused by President Trump's tariff hikes. Despite China's Commerce Ministry vowing to retaliate against these tariffs, investor sentiment seemed to stabilize somewhat, with futures for major U.S. indices showing positive gains. Regional markets, including Hong Kong and Shanghai, also exhibited varying degrees of recovery, although not all were able to recapture previous losses.
The rebound across most regional markets followed a tumultuous day on Wall Street, where stocks experienced dramatic fluctuations after Mr. Trump announced plans to increase tariffs. Early Tuesday, China’s Commerce Ministry declared its intent to counteract the United States' actions with unspecified measures. However, this did not deter the positive momentum seen in futures trading. The S&P 500 futures climbed by 1.61%, while those for the Dow Jones Industrial Average rose by 1.9%.
In Tokyo, the Nikkei 225 closed significantly higher at 33,012.58, marking an impressive gain of just over 6%. Meanwhile, Hong Kong's Hang Seng Index managed to recover some lost ground, gaining 1% to reach 20,036.03, though it remained far from its steep decline earlier in the week. The Shanghai Composite Index saw a boost as well, rising by 1.4% to 3,140.15, supported by government-directed share purchases aimed at stabilizing the market.
South Korea's Kospi and Australia's S&P/ASX 200 also demonstrated resilience, climbing modestly to 2,334.23 and 7,510.00 respectively. Conversely, markets in Thailand and Indonesia faced challenges upon reopening after holidays, experiencing notable declines. In Jakarta, trading was briefly halted when the JSX index plummeted more than 9%, eventually settling at a 7.6% drop by mid-afternoon. Similarly, Thailand's SET dropped by 4.2%.
Taiwan's Taiex similarly encountered difficulties, dropping by 4% due to losses sustained by Taiwan Semiconductor Manufacturing Corp., a leading global chip manufacturer whose shares fell by 3.8% on Tuesday. Back in the United States, Monday's trading session ended with mixed results: the S&P 500 slipped by 0.2%, the Dow declined by 0.9%, and the Nasdaq edged up slightly by 0.1%. Analysts caution that future stock performance will heavily depend on whether trade agreements can be reached or if prolonged tariffs might lead to economic downturns.
As tensions persist between major economies, the global financial landscape remains volatile. Investors continue to monitor developments closely, hoping for resolutions that could stabilize markets and prevent further economic disruptions. While recent rebounds offer some relief, uncertainties surrounding trade policies still pose significant risks to both regional and international markets.