Asian Stocks May Dip as Trump to Hike Korea Tariff: Markets Wrap
(Bloomberg) — Asian equities may open weaker after President Donald Trump threatened to raise levies on South Korean goods, reigniting tariff concerns. The yen held its gains against the dollar.
The won will be in focus after Trump signaled plans to hike tariffs on goods from South Korea to 25%. Japanese stocks looked set to lag the region, weighed down by a stronger yen. That came after the S&P 500 ended Monday’s session 0.5% higher while the tech-heavy Nasdaq 100 advanced 0.4%.
The yen traded near 154 per dollar after gaining around 1% on the greenback amid speculation the US may coordinate intervention with Japan to support the Japanese currency. A gauge of the dollar is close to its lowest level since 2022. Gold topped $5,000 and silver soared by the most since 2008.
In the US, companies accounting for roughly a third of the S&P 500’s market capitalization report this week, as investors scrutinize whether heavy spending by artificial-intelligence names is beginning to deliver stronger returns. So far, forward guidance has topped expectations at roughly half of the S&P 500 companies that have provided an outlook for 2026, according to an analysis by JPMorgan Chase & Co.
“Tech has become more of a show-me story,” said Darrell Cronk, chief investment officer, wealth and investment management at Wells Fargo, which manages $2.3 trillion. “If Big Tech can continue to deliver, I think capital will start flowing in tech’s direction again.”
The rising yen remained in focus after comments from Japanese officials fueled speculation that the government may intervene in the market to prevent the currency from resuming its slide. To some, however, the recent rally has partly neutralized the likelihood of intervention.
“The dramatic recovery in the yen suggests that actual intervention is not needed,” said Marc Chandler at Bannockburn Capital Markets.
Meanwhile, Trump attributed a 25% tariff hike on South Korean goods to the country’s legislature failing to codify a trade agreement reached with the US last year.
The US president has ratcheted up trade tensions with several allies in recent weeks, threatening to raise duties on Canadian products to 100% if Ottawa signed a trade deal with China and to slap new charges on European countries’ goods over his quest to seize control of Greenland.
Read: Charting the Global Economy: Japanese Bond Rout; Greenland Deal
Rising stocks and precious metals as Treasuries ebbed and the dollar fell rekindled some of the hallmark trades of last year, as investors looked through a mixed macroeconomic backdrop to focus on robust corporate earnings.
Treasuries remained in a narrow range on Monday with the Federal Reserve expected to pause its rate cuts.
Fed officials are expected to hold rates steady following three straight cuts at the end of 2025 as a steadier jobs market restores a degree of consensus at the central bank after months of growing division. Chair Jerome Powell is likely to telegraph his view that policy is well-positioned for now, but refrain from signaling much about where rates are headed.
“Even though the Fed isn’t expected to cut interest rates, Powell’s press conference may be as much about Fed independence as it is policy,” said Chris Larkin at E*Trade from Morgan Stanley.
Expectations about Fed policy have been shifting in response to changes in the consensus view on whom Trump will nominate to succeed Powell, whose term expires in May.
Elsewhere, US power grids are under mounting pressure following a winter storm that unleashed deep cold and heavy snow and ice from Texas to Maine. That’s knocked an estimated 12% of US natural gas production off-line and forecasts for frigid weather caused prices to soar.
US natural gas prices jumped around 30%, while oil prices broadly sidestepped the tumult on an improving supply outlook for Kazakhstan.
Corporate Highlights:
Morgan Stanley plans to step up ties with Mitsubishi UFJ Financial Group Inc. to get more market share across all of its businesses in Japan, the US bank’s local chief said. Nvidia Corp., the dominant maker of artificial intelligence chips, invested an additional $2 billion in the cloud computing firm and key customer CoreWeave Inc., marking the latest example of the circular financing deals that have lifted valuations of AI companies and fueled concerns about a bubble. A Zijin Mining Group Co. subsidiary agreed to buy Allied Gold Corp., which owns gold mines in Africa, for C$5.5 billion ($4 billion) in the latest step in the Chinese company’s rapid growth. The split between Pirelli & C. SpA’s two biggest investors widened when a proposal by China’s Sinochem Group aimed at addressing the tiremaker’s US regulatory risks was rejected by its top Italian owner. Some of the main moves in markets:
Stocks
S&P 500 futures were little changed as of 8:09 a.m. Tokyo time Hang Seng futures rose 0.5% Australia’s S&P/ASX 200 rose 0.8% Currencies
The Bloomberg Dollar Spot Index fell 0.4% The euro was little changed at $1.1879 The Japanese yen was little changed at 154.20 per dollar The offshore yuan was little changed at 6.9490 per dollar The Australian dollar was little changed at $0.6912 Cryptocurrencies
Bitcoin was little changed at $88,039.14 Ether fell 0.2% to $2,919.75 Bonds
Australia’s 10-year yield was little changed at 4.82% Commodities
West Texas Intermediate crude rose 0.3% to $60.83 a barrel Spot gold rose 0.5% to $5,035.58 an ounce This story was produced with the assistance of Bloomberg Automation.
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