Asia-Pacific markets rise after U.S. trade court blocks Trump 'reciprocal' tariffs

1 month ago 23

Hongdae street in Seoul city, South Korea

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Asia-Pacific markets mostly rose Thursday after a U.S. federal trade court ruled that President Donald Trump exceeded his authority with his "reciprocal" tariffs, dealing a blow to a major tenet of the president's economic agenda.

South Korea's Kospi rose 1.89% to end the day at 2,720.64 while the small-cap Kosdaq climbed 1.03% to 736.29. The Bank of Korea cut its policy rate from 2.75% to 2.5% Thursday, its lowest level since August 2022, in line with expectations among economists polled by Reuters.

Japan's benchmark Nikkei 225 rose 1.88% to end the day at 38,432.98, and the Topix climbed 1.53% to 2,812.02.

Australia's S&P/ASX 200 edged up 0.15% to close at 8,409.8.

Hong Kong's Hang Seng index advanced 1.35% to end the day at 23,573.38 while mainland China's CSI 300 moved 0.59% higher to 3,858.70.

India's benchmark Nifty 50 and BSE Sensex were flat as at 1.45 p.m. Indian Standard Time.

Investors will be keeping an eye out for Asian chip stocks after artificial intelligence heavyweight Nvidia posted stronger-than-expected earnings and revenue Wednesday, driven by a 73% year-over-year surge in its data center business.

U.S. futures rose, buoyed by the court ruling and Nvidia's strong earnings report.

Futures tied to the S&P 500 jumped 1.44%, while Nasdaq 100 futures gained 1.76%. Dow Jones Industrial Average futures added 483 points, or 1.15%.

Overnight, the three major stock averages closed lower as investors parsed the latest earnings reports and Federal Reserve meeting minutes.

The S&P 500 slid 0.56% to end at 5,888.55, while the Nasdaq Composite shed 0.51% and settled at 19,100.94. The Dow Jones Industrial Average fell 244.95 points, or 0.58%, and closed at 42,098.70.

— CNBC's Alex Harring, Sarah Min and Pia Singh contributed to this report

Hong Kong Financial Secretary says U.S. court order on Trump’s 'reciprocal' tariffs will bring him ‘to reason’

The U.S. Court of International Trade's recent ruling blocking U.S. President Donald Trump's "reciprocal" tariffs will hopefully bring Trump "to reason," said Hong Kong Financial Secretary Paul Chan at a Capital Markets Forum fireside chat organized by Saudi exchange operator Tadawul Group.

Against this backdrop, the entire landscape of international trade will change, with mainland Chinese companies increasingly going global and realigning their supply chains overseas, Chan told CNBC's Emily Chan.

And despite the de-dollarization trend, Hong Kong remains "firmly committed" to the Linked Exchange Rate System with "no intention at all" of changing it, Chan added.

The Linked Exchange Rate System was created in 1983, which pegs the city's currency in a tight band to the U.S. dollar.

The Hong Kong Monetary Authority has been in close dialogue with stakeholders regarding the matter and is "in control of the situation," Chan said.

—Neha Hegde

Oil prices climb after U.S. court ruling, and Russia supply concerns

Oil prices climbed after a U.S. federal court struck down U.S. President Donald Trump's "reciprocal" tariffs, and Russian crude supply worries.

The U.S. West Texas Intermediate rose 1.31% to $62.65 per barrel, and International Brent crude climbed 1.22% to $65.69 per barrel.

Oil price gains were tempered as concerns over potential U.S. sanctions on Russia — which could disrupt Russian oil exports — were balanced by expectations of increased supply from OPEC+, Commonwealth Bank of Australia wrote in a note published Thursday.

—Lee Ying Shan

Bank of Korea cuts interest rates for the fourth time in bid to bolster growth

South Korea's central bank cut its policy interest rate by 25 basis points in a decision announced Thursday as the country faces a double-whammy of protracted political turmoil and Trump's sweeping tariffs.

The Bank of Korea reduced rates to 2.5% from 2.75%, its lowest level since August 2022, in line with expectations among economists polled by Reuters. That marked the central bank's fourth cut in the current easing cycle.

The quarter-percentage rate cut came as the country continued to grapple with heightened political uncertainty following the botched attempt by former leader Yoon Suk Yeol to impose martial law in December.

Read the full story here.

—Anniek Bao

Federal trade court strikes down Trump’s reciprocal tariffs

A federal court ruled Wednesday that President Donald Trump exceeded his authority with his reciprocal tariffs, dealing a blow to a major tenet of the president's economic agenda.

A three-judge panel at the U.S. Court of International Trade ruled that the International Emergency Economic Powers Act, a 1977 law that Trump invoked to justify the tariffs, does not actually give the president the power to unilaterally implement the sweeping duties.

"The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA to regulate importation by means of tariffs," the judges wrote in their ruling.

Read the full story here.

—Erin Doherty, Lora Kolodny, Kevin Breuninger