Tokyo stocks rise on hopes for easing US-China trade tensions
TOKYO (Kyodo) -- Tokyo stocks rose Friday morning on hopes for an easing of trade frictions between the United States and China after the leaders of the world's two largest economies agreed to hold a new round of trade talks soon.
The 225-issue Nikkei Stock Average gained 176.18 points, or 0.47 percent, from Thursday to 37,730.67. The broader Topix index was up 15.34 points, or 0.56 percent, at 2,771.81.
The U.S. dollar mostly remained firm in the upper 143 yen range in Tokyo, supported by receding concern about the U.S. economic outlook after President Donald Trump and Chinese President Xi Jinping held phone talks, dealers said.
At noon, the dollar fetched 143.83-86 yen compared with 143.57-67 yen in New York and 143.34-36 yen in Tokyo at 5 p.m. Thursday.
The euro was quoted at $1.1437-1438 and 164.50-55 yen against $1.1438-1448 and 164.20-30 yen in New York and $1.1412-1413 and 163.59-63 yen in Tokyo late Thursday afternoon.
Stocks climbed as the talks between the U.S. and Chinese leaders fueled hopes for progress in their nation's tariff negotiations. Export-oriented auto and machinery shares climbed on the weaker yen, which increases exporters' overseas profits when repatriated.
The Nikkei index was boosted by heavyweight semiconductor-related issues on expectations for robust artificial intelligence-related demand after a major U.S. chip firm released stronger-than-expected earnings results, brokers said.
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Japan Times
8 minutes ago
- Japan Times
Xi bets Trump detente leads to future wins on chips and tariffs
In the early hours of Wednesday, Donald Trump declared that Xi Jinping was "VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH!!!' Some 36 hours later, the U.S. leader said he got what he wanted: A commitment to restore the flow of rare earth magnets. It's less clear what Xi got in return, apart from putting a lid on further punitive U.S. measures. One of the few clear takeaways appeared to be an assurance for the U.S. to welcome Chinese students, a major issue in China but also not one that would explain why Xi got on the phone after making Trump wait for months. By taking the call now, Xi appears to be betting that a reset in ties will lead to tangible wins in the weeks and months ahead, including tariff reductions, an easing of export controls and a generally more civil tone. The biggest sign of that was another round of talks — planned for Monday in London — that will now include U.S. Commerce Secretary Howard Lutnick, who's in charge of curbs on the sale of advanced technology to China. Whether Xi will get any of that, however, now hinges on a famously erratic Trump administration in which views toward China differ drastically. "This call provides tactical de-escalation for U.S.-China relations,' said Sun Chenghao, a fellow at the Center for International Security and Strategy at Tsinghua University in Beijing. "However, China's core demands — equal sanction relief, reciprocal enforcement mechanisms, and an end to tech containment — remain critical for sustainable agreements,' he added. "Without substantive U.S. adjustments in follow-up talks and policies, the consensus may not translate into long-term stability.' Investors were skeptical that relations between the world's biggest economies were finally on track, with China's CSI 300 Index little changed on Friday. While the two leaders spoke just days before Trump's inauguration, Xi had kept his U.S. counterpart waiting for a phone call ever since as tensions rapidly escalated, with tariffs climbing well beyond 100% before the two sides agreed to lower them in Geneva last month. In recent days, Trump had looked like the more desperate of the two, seen by his repeated requests for a call capped off by his social media post at 2:17 a.m. on Wednesday. The call next day finally ended the longest post-inauguration silence between American and Chinese leaders in more than 20 years. "We're in very good shape with China and the trade deal,' Trump told reporters on Thursday after the 90-minute conversation. "I would say we have a deal, and we're going to just make sure that everybody understands what the deal is,' he added. The big immediate problem for the U.S. was a lack of rare earth magnets essential for American electric vehicles and defense systems. After the Geneva meeting, the U.S. side believed it had secured the flow of these materials, only to be disappointed when China kept its export licensing system in place, saying that exporters to the U.S. still needed to apply just like everyone else. China, in turn, felt betrayed by a fresh wave of U.S. restrictions on AI chips from Huawei Technologies, software for designing chips, plane engines and visas for upwards of 280,000 Chinese students. "Both sides felt that the agreement in Geneva was being violated,' said Gerard DiPippo, associate director at the RAND China Research Center. From the White House's perspective, he said, "China committed to send the magnets.' Although Xi flexed his muscles with the rare earths restrictions, he also has reasons to come to the table. China's economy is expected to slow sharply in the second quarter and come under pressure into the second half of the year, according to Morgan Stanley economists led by Robin Xing. "Now the China pendulum is swinging back from 'political principle' of standing firm against the U.S. to 'pragmatism' in support of a still fragile economy,' said Han Lin, China country director at The Asia Group. "In other words, Beijing wants to de-escalate, and as long as there is a face-saving path for Xi to do so, now is better than never.' Xi can point to several things that indicate more is coming. The addition of Lutnick in upcoming trade talks, led in Geneva by Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer, signals Trump may be willing to consider reversing some of the technology curbs that threaten to hobble China's long-term growth ambitions. Xi's statement after the call also made clear he expects the U.S. to "remove the negative measures taken against China,' which could include warnings against the use of Huawei's Ascend chips and restriction on the sale of chip design software to China. The two leaders also exchanged invitations to visit each other's country, events that will build momentum toward stabilizing the relationship with agreements on thorny issues spanning trade, export controls and people-to-people exchanges. Trump said their wives would also come along, adding to the positive optics. It's significant that Trump agreed to visit China first, according to Bert Hofman, professor at the East Asian Institute at the National University Singapore and former World Bank country director for China. "Xi probably realized that a call would be in the Chinese interest given the eagerness of Mr. Trump to have one,' he said. "This will accelerate talks and hopefully extend the truce beyond August,' he added, as the tariff reductions agreed in Geneva will expire in early September. But some analysts advised against being overly optimistic, pointing out the lack of details on key trade matters. "There doesn't seem to be a deeper agreement that would prevent either side from taking additional negative actions, even as talks proceed,' said Kurt Tong, a former U.S. consul general in Hong Kong and a partner at The Asia Group. That fragility is compounded by Trump's transactional approach to foreign policy and ties with China in particular. In January 2020, when Trump signed a Phase-One trade deal with Beijing, he said the relationship between the countries was "the best it's ever been' before it quickly unraveled following the spread of COVID-19 around the globe. "It would be unwise to bet that Trump has a vision for further negotiations that he won't abandon suddenly later on,' said Graham Webster, who leads the DigiChina project at Stanford University. Another area where Xi could see an early win is on the issue of fentanyl. Any deal to cooperate in blocking the flow of the drug to the U.S. could immediately bring down American tariffs on Chinese imports by 20 percentage points. While the call helped to stem the negative trajectory of the relationship, the next two weeks will be crucial to confirm whether the truce will last, according to Wu Xinbo, a professor at Fudan University in Shanghai. He said China expects to see more progress on tariffs and U.S. tech curbs. "The call in itself is not a reward,' Wu said. "What's important is what will come out of the call.'
NHK
an hour ago
- NHK
US and China set to resume trade talks on Monday
The US and China have been engaged in a bruising trade war that's lasted for months, but there may be signs of a thaw. US President Donald Trump has held a phone call with his Chinese counterpart and says negotiators from the two sides will sit down for talks on Monday. Trump wrote on social media Friday that his treasury secretary, commerce secretary and trade representative will take part. The meeting will be held in London. He had previously complained that China is violating a trade deal that was agreed to just last month. His administration also says China is holding up exports of rare-earth materials. However, he has struck a different tone since the call with President Xi Jinping on Thursday. He said relations are back on track and negotiations for the trade deal are in "good shape." Reuters has quoted sources as saying the rare-earths issue may be easing as well. It says China has granted temporary export licenses to the entities that supply the top three US automakers.
Japan Today
2 hours ago
- Japan Today
'Matcha crisis' emerges as the world falls in love with powdered green tea
By SoraNews24 Once the hidden gem of Japanese tea ceremonies and confectionery, the carefully ground green tea known as matcha has taken the world by storm with its vibrant green color, complex taste that seems to complement sweetness perfectly, and health benefits. But now, those in the industry are starting to wonder if the ingredient can handle getting this big. Image: SoraNews24 In order to achieve the best color and flavor in matcha, the plants' exposure to sunlight needs to be carefully regulated. This means the very best matcha you're likely to find is grown on a small scale with a high degree of personal attention. Even with attempts to modernize and industrialize production, there are still limitations because certain processes like growing the plants and grinding the leaves need to be done very slowly in order to be done properly. Since production can't be sped up, it would have to be expanded in order to produce more, and seeing the potential for matcha exports, the government began subsidizing green tea production a couple years ago in the hopes of focusing Japan's shrinking agricultural labor force on the coveted ingredient. Meanwhile, China stepped into the game too a while back and is currently the leading producer of matcha in the world. However, much of that is sold in their own gigantic domestic market and since they focus more on efficiency in production, it could be said that the quality is lower. ▼ These green tea plants in Saitama Prefecture are being grown in full sunlight, which means they cannot be used for matcha. Image: SoraNews24 The recent trade chaos caused by U.S. President Donald Trump may give Japan a competitive edge against China as Japan is expected to get a more lenient deal in the very sizable American market. Unfortunately, that probably won't make a difference, because even despite Japan's efforts at more than doubling matcha production in the past 10 years, that still won't be enough to meet the increasingly ravenous worldwide demand for the stuff. According to a tea buyer in the UK, sales of matcha-flavored drinks have tripled in the past year alone and have even surpassed that of the classic Earl Grey there. Some in other countries like the U.S. said they have completely given up coffee in favor of matcha. A vendor in Ireland remarked that Japan will probably need to increase its production by 10 times in the next five years in order to keep up. Considering the fact that farmers of all kinds are literally a dying breed in Japan, a 10-fold increase seems unlikely unless a radical solution can be found. Many in the industry are saying we're already in the midst of what they call a 'matcha crisis' with it being hard to secure, and if both supply and demand continue on their current course we may end up in a full-blown matcha supply shock. ▼ A news report on the matcha crisis… I feel bad for those girls who probably had no idea they would appear on Japanese TV with 'MATCHA CRISIS' underneath. This could cause prices to spike hard and throw the future of matcha as we know it into turmoil. With the demand being what it is, it would seem likely that buyers in other countries would turn to more quickly produced and inferior matcha both from Japan and China, lowering the bar for a drink and ingredient once only made with an extremely high degree of craftsmanship. Many online comments in Japan felt that rising prices would preemptively help protect the integrity of Japan's more finely produced matcha and put it on the level of a high-class ingredient that it deserves. 'Japan has been selling it too cheaply. It should be marketed as a high-end product because it is.' 'This could just be a fad too, like bubble tea or tiramisu. Increasing production for now is fine, but you need to be prepared for after.' 'I don't think matcha is a passing fad because it can be used in so many ways.' 'Why don't they sell it for more?' 'This global demand probably doesn't know what good matcha tastes like, so the market will be flooded with poor-quality stuff.' 'Raise prices and make more of it so we can get some money over here.' 'Alright, who told everyone that matcha is delicious?' 'Looks like taking matcha snacks as a present for my trip to Europe was the right choice.' 'I work at a store in a tourist-heavy area and everyone is buying matcha stuff.' 'The matcha used in the tea ceremony is very carefully made. I hope this wave of commercialism doesn't affect that.' Indeed, matcha might've done well to follow the sake model in which it is marketed as a luxury drink and tends to sell for a premium overseas due to the high degree of technique that often goes into making it. But in the end, it will probably splinter off into something like chocolate where you'll have a more clear-cut range of co-existing options from the exquisitely crafted and highly expensive kinds to the stuff they use to mass produce KitKats. Source: TV Asahi News, The Guardian, Kyodo, YouTube/ANNnewsCH Read more stories from SoraNews24. -- Japanese tea house creates gold-leaf covered matcha green tea gelato dessert -- Japanese company develops matcha paste that retains more health benefits than a cup of green tea -- Japanese tea shop introduces $16-a-scoop matcha ice cream, has good reason for eye-popping price External Link © SoraNews24
