Asian stocks rally after Trump tariffs hit court hurdle

West Australian

3 days ago

Asian shares and Wall Street futures have climbed in Asia after a US federal court blocked President Donald Trump's Liberation Day tariffs from going into effect, sending the dollar up on safe haven currencies.
The Manhattan-based Court of International Trade ruled that Trump overstepped his authority by imposing across-the-board duties on imports from nations that sell more to the United States than they buy.
The White House quickly appealed the decision, and could take it all the way to the Supreme Court if needed, but in the meantime it offered some hope that Trump might back away from the highest tariff levels he had threatened.
"We're just trying to work out what it might mean basically but obviously the market is doing a knee-jerk reaction," said Ray Attrill, head of FX strategy at NAB.
"So this may be an absolute storm in a teacup or potentially something more significant."
MSCI's broadest index of Asia-Pacific shares outside Japan edged up on Thursday, awaiting the opening of Chinese markets.
Japan's Nikkei index jumped 1.5 per cent to 38,263.36. American's largest ally in Asia has been appealing to Trump to cancel the tariffs he has ordered on imports from Japan and to also stop 25 per cent tariffs on steel, aluminium and autos.
The ruling also pushed the US dollar sharply higher against the Japanese yen. It was trading at 146.06 yen early Thursday, up from 144.87 yen late Wednesday.
Australia's ASX gained 0.3 per cent to 8,418.90.
In South Korea, the Kospi surged 1.4 per cent to 2,707.77. Shares also were helped by the Bank of Korea's decision to cut its key interest rate to 2.5 per cent from 2.75 per cent, to ease pressure on the economy.
S&P 500 futures climbed 1.5 per cent, while Nasdaq futures rose 1.8 per cent. The latter had already been lifted by relief over earnings from Nvidia, which beat sales estimates.
The chipmaker and AI darling also projected strong revenues for the current quarter, sending its shares up 4.4 per cent after hours.
That news helped offset a Financial Times report the White House had ordered US firms that offer software used to design semiconductors to stop selling their services to Chinese groups.
The New York Times separately reported the United States had suspended some sales to China of critical US technologies, including those related to jet engines, semiconductors and certain chemicals.
The news of the court decision hit traditional safe havens, lifting the dollar 0.8 per cent on the Swiss franc to 0.336. It gained 0.6 per cent on the Japanese yen to 145.76 yen, while the euro dipped 0.5 per cent to $US1.1230.
Yields on 10-year Treasuries rose three basis points to 4.51 per cent and markets further shaved the chance of a Federal Reserve rate cut anytime soon.
Minutes of the last Fed meeting showed "almost all participants commented on the risk that inflation could prove to be more persistent than expected" due to Trump's tariffs.
A rate cut in July is now seen as just a 22 per cent chance, while September has come into around 60% having been more than fully priced a month ago.
In commodity markets, gold slipped 0.9 per cent to $US3,259 an ounce .
Oil prices extended a rally begun on supply concerns as OPEC+ agreed to leave their output policy unchanged and as the US barred Chevron from exporting Venezuelan crude.
US crude firmed 47 cents to $US62.31 per barrel.
with AP