Most Asian stocks rose on Tuesday, brushing off renewed U.S. trade tariff threats after President Donald Trump signaled openness to further negotiations. However, Australian equities underperformed following an unexpected policy hold by the Reserve Bank of Australia (RBA).
Despite issuing letters that outlined higher tariffs for several countries, President Trump announced a shift in the effective date to August 1, pushing back from the earlier July 9 deadline. More importantly, he told reporters the August date was not “100% firm” and remained open to alternate trade proposals.
These signals of flexibility helped Asian equities rebound after a weak overnight session on Wall Street. U.S. stock futures pared losses, with S&P 500 Futures trading flat after initially dipping 0.3%.
South Korea’s KOSPI surged 1.5%, led by memory-chip giant SK Hynix, which jumped over 3% following weak Q2 profit guidance from rival Samsung Electronics. Japan’s Nikkei 225 added 0.3%, while the TOPIX index gained 0.1%.
Trump announced 25% tariffs on South Korea, Japan, and Malaysia, 30% on South Africa, and as high as 36% on Thailand, effective August 1. Despite these headlines, markets remained resilient.
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Chinese markets posted strong gains with the Shanghai Shenzhen CSI 300 up 0.7% and the Shanghai Composite up 0.6%. Hong Kong’s Hang Seng index rose 0.7%, while Singapore’s Straits Times index added 0.5%.
The optimism was driven by the hope that ongoing trade talks would avert steep tariff escalations and that Trump’s flexible tone signaled further diplomatic room.
India’s Nifty 50 index traded sideways as market participants focused on a potential U.S.-India trade agreement, which the White House hinted was nearing completion.
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Australia’s ASX 200 index declined 0.2%, under pressure after the RBA held rates steady at 3.85%, surprising markets that expected a 25 basis point cut.
The RBA stated it needed more confirmation that inflation was cooling before proceeding with further easing. This marks the third time this year the central bank has defied market expectations.
