Japan’s Nikkei Decline as Asian Stocks Mixed on Global Uncertainities

Asian stock markets displayed mixed trends on Thursday as investors reacted to U.S. President Donald Trump’s announcement of 25% tariffs on car imports, effective April 2. The announcement, coupled with confirmation of reciprocal tariffs throughout Trump’s second term, has raised concerns about potential retaliation and broader economic repercussions, including heightened currency market volatility.

In Japan, the Nikkei fell 0.95%, dropping below 37,900, while the Topix Index declined 0.4%, ending a two-day rally on Asian stock markets. The Japanese yen strengthened to near 150 per dollar, recovering losses from the previous session. Prime Minister Shigeru Ishiba stated that Japan would not rule out countermeasures against these tariffs.

China’s markets saw modest gains during Asian stock trading hours, with the Shanghai Composite Index (SHCOMP) rising 0.31% to above 3,370, and the Shenzhen Component increasing by 0.35% to reach 10,680. The offshore yuan rebounded to around 7.26 per dollar after hitting a three-week low earlier.

However, industrial profits in China dropped by 0.3% in the first two months of 2025, highlighting ongoing deflationary pressures and intensifying trade tensions with the U.S. In response, China has ramped up debt issuance, raising a record CNY 1.45 trillion through sovereign notes in the first quarter, tripling the issuance from the same period last year.

Hong Kong’s Hang Seng Index (HSI) continued its upward trajectory on Asian stock markets, climbing 0.73% to 23,824, buoyed by broad-based gains. India’s Sensex rose 0.52% to 77,674, recovering from prior losses as traders took advantage of profit-booking opportunities amid uncertainties related to U.S.-India trade negotiations. Optimism persists regarding positive outcomes from the ongoing talks.

Australia’s ASX 200 fell 0.38% to close at 7,969, marking the end of a five-day winning streak over other Asian stock markets. Meanwhile, the Australian dollar surged past $0.63, reversing losses from the previous session. Looking ahead, the Reserve Bank of Australia is widely expected to maintain its interest rates in the upcoming meeting next week.

In the U.S., major stock indices experienced a downturn earlier in the week, led by tech stocks, as fears over impending tariffs caused a broad selloff. Attention has now shifted to Friday’s PCE price index report, which is the Federal Reserve’s preferred measure of inflation.

Today’s performance across Asian Stock markets underscores the complexities of navigating global economic challenges. Select stocks like Sony, Alibaba, Meituan, Samsung Electronics, Infosys, and BHP Group stand out for their innovation, market leadership, and growth potential. As global conditions evolve, these companies and sectors offer valuable opportunities for investors seeking to balance risk and reward. The Trading Room Analyst Rennie Odek commented.