Asian shares mostly finish higher although worries continue over Trump's tariffs

Qatar Tribune

19 hours ago

Agencies
Asian shares were mostly higher in Tuesday trading, despite lingering worries about President Donald Trump's latest updates to his tariffs that weighed on investor
sentiments.
Japan's benchmark Nikkei 225 rose 0.6% to finish at 39,678.02. Australia's S&P/ASX 200 added 0.7% to 8,630.30. South Korea's Kospi edged up 0.4% to 3,215.28. Hong Kong's Hang Seng rose 0.9% to 24,423.87, while the Shanghai Composite dipped 0.4% to 3,505.00, after the Chinese government reported that growth slowed in the last quarter as Trump's trade war escalated.
Tuesday's data showed the economy expanded at a robust 5.2% annual pace, compared with 5.4% annual growth in January-March. In quarterly terms, the world's second-largest economy expanded by 1.1%, according to government data.
Despite worries about the damage Trump's tariffs may have on the region's exporters, speculation continues that he may ultimately back down on them. They don't take effect until Aug. 1, which leaves time for more negotiations.
On Wall Street Monday, the S&P 500 edged up by 0.1%, the Dow Jones Industrial Average added 0.2% and the Nasdaq composite rose 0.3%.
A nationwide election for the upper house of Japan's Parliament, set for Sunday, also added to the wait-and-see attitude among market players. Analysts say the ruling pro-business Liberal Democratic Party may face an uphill battle and will likely need coalition partners, including possibly new ones, to keep its grip on power.
If Trump were to enact all his proposed tariffs on Aug. 1, they would raise the risk of a recession. That would not only hurt American consumers but also raise the pressure on the U.S. government's debt level relative to the economy's size, particularly after Washington approved big tax cuts that will add to the deficit.
'We therefore believe that the administration is using this latest round of tariff escalation to maximize its negotiating leverage and that it will ultimately de-escalate, especially if there is a new bout of heightened bond and stock market volatility,' according to Ulrike Hoffmann-Burchardi, global head of equities at UBS Global Wealth Management.
'As usual, there are many conditions and clauses that can get these rates reduced,' said Brian Jacobsen, chief economist at Annex Wealth Management.
'That's probably why the market might not like the tariff talk, but it's not panicking about it either.' For the time being, the uncertainty around tariffs could help keep markets unsteady.