US stocks rallied for a third straight session yesterday, shrugging off signs US trade deals with China and the EU aren’t imminent.
Beijing had said yesterday any claims of ongoing trade talks with Washington were “groundless” after Trump played up the prospects of a deal to lower hefty tariffs he imposed on China.
France’s economy minister Eric Lombard said a trade deal between the US and the EU was also a way off.
However, global markets appear to have brushed aside the lack of progress.
“There are mixed signals about whether there have been some talks about trade between US and China,” said Lloyd Chan, a senior currency analyst at MUFG.
“Nonetheless, the trade war and US policy-related uncertainty have persisted. Asian economies still face the risk of higher reciprocal tariffs,” Chan said.
Tokyo climbed 1%, while Hong Kong, Shanghai were also up.
The Nikkei rise came despite struggling Japanese auto giant Nissan issuing a stark profit warning yesterday, forecasting a huge loss of up to US$5.3 billion in the 2024-2025 financial year.
The markets see that the company “is moving ahead toward turnaround”, said Bloomberg Intelligence analyst Tatsuo Yoshida, as Nissan shares climbed more than 3% today.
“Booking significant impairment losses and restructuring charges is a necessary step toward Nissan Motor’s turnaround,” Yoshida said.
Seoul jumped 0.5% after US treasury secretary Scott Bessent said a trade “understanding” between South Korea and the US could be reached by next week
Taipei, Sydney, Singapore, Manila and Wellington also climbed.
Markets were responding to strong earnings from Google parent Alphabet, which reported yesterday a profit of US$34.5 billion in the recently ended quarter.
Overall revenue at Alphabet grew 12% to US$90.2 billion compared to the same period a year earlier, while revenue for the cloud unit grew 28% to US$12.3 billion, according to the tech giant.
MUFG’s Chan also pointed to the Federal Reserve (Fed) possibly cutting interest rates sooner than expected.
Fed governor Christopher Waller said during an interview with Bloomberg Television that he would support interest rate cuts if harsh tariffs hurt the jobs market.
“In terms of the latest Fed speak, Fed’s Waller has said he would support rate cuts should there be a significant deterioration in the labour market,” Chan said.