Most Asian markets saw gains on Tuesday, buoyed by optimism that President Donald Trump may extend or broaden exemptions to his contentious trade tariffs. However, growth remains constrained by caution regarding ongoing trade tensions and the likelihood of renewed tariffs targeting Chinese imports.

Market Insights

• Positive Sentiment:

  Asian markets were inspired by Wall Street’s back-to-back gains, fueled by optimism surrounding possible tariff carveouts and strong earnings from U.S. banks.

• U.S. Futures Show Caution:

  In early trading in Asia, S&P 500 Futures fell by 0.1%, indicating concern among investors amid thin trading volumes before the Good Friday holiday.

Performance by Region

• Leading Markets:

  • Nikkei 225 (Japan): +1.3%

  • KOSPI (South Korea): +1.1%

  • Straits Times Index (Singapore): +0.9%

  • Taiwan Weighted Index: +1.0%

  These markets benefited from strength in the technology and automotive sectors, which are expected to gain from tariff exemptions.

• Underperforming Market:

  • China: Chinese stocks displayed fluctuation with swings between gains and losses. The market sentiment was subdued due to the ongoing tensions between Washington and Beijing. While some optimism emerged from U.S. tariff exemptions, apprehension remained due to Trump’s comments about the temporary nature of the waivers.

Sector Highlights

• Technology Sector Growth:

  Tech stocks continued to outperform, boosted by news that reciprocal tariffs on Chinese goods would exempt electronics, thus reducing immediate disruption risks for the global semiconductor and electronics supply chain.

• Automotive Sector Rally:

  Japanese and South Korean automotive companies enjoyed significant gains on expectations that additional exemptions may include vehicle exports, particularly amid rumors of bilateral talks behind closed doors.