Asian stocks mixed as tech-led Wall Street rebound offsets tariff anxieties

Asian markets opened cautiously on Tuesday, lacking clear direction despite a tech-driven rally on Wall Street the previous night. A regional benchmark swung between small gains and losses, while US equity futures dipped by 0.2%.

The dollar held steady after touching its lowest level since 2023 in the prior session, and bond markets were largely unchanged during early Asian hours.Oil prices continued to rise, building on earlier gains, while gold held firm after recording its sharpest daily increase in four weeks. Investor sentiment remained fragile amid conflicting trade headlines and geopolitical risks.Technology stocks helped the S&P 500 climb 0.4% on Monday, marking a positive start to June — a month typically quiet in terms of equity gains.

"We continue to expect market volatility as investors digest fresh tariff headlines and incoming US economic data," said Ulrike Hoffmann-Burchardi at UBS Global Wealth Management. "Fiscal worries remain, and geopolitical tensions are heating up."Trade developments remain centre-stage. The US extended exclusions on Section 301 tariffs for certain Chinese goods through August 31. According to Reuters, the Trump administration is pushing for renewed trade proposals by Wednesday and seeking a phone call between President Trump and Chinese President Xi Jinping — although Xi has so far avoided direct talks, preferring negotiations through advisers.

Their last known call occurred in January before Trump’s inauguration.

White House adviser Kevin Hassett signalled Sunday that a phone conversation was expected this week.Japan’s trade negotiator Ryosei Akazawa is reportedly considering a trip back to the US as both nations aim for a potential deal this month. Meanwhile, investors in Tokyo are eyeing a ¥2.6 trillion ($18 billion) 10-year bond sale amid concerns about soft demand and the country’s borrowing plans."The markets keep shrugging off simmering trade war risks," said Kyle Rodda, senior market analyst at Capital.com. "While it has slipped down the list of priorities for market participants, below trade policy, fiscal policy and macroeconomic data, a very solid set of quarterly results from mega cap tech is enticing investors into the market."In geopolitics, a second round of Russia-Ukraine talks concluded in Istanbul without a breakthrough but opened the door to a fresh prisoner exchange.On Monday, Asian equities tumbled after US President Donald Trump escalated trade tensions by doubling tariffs on steel and aluminium to 50%, accusing China of violating a recent trade truce. “China has totally violated the agreement,” Trump said, referring to a 90-day pause agreed last month. US Commerce Secretary Howard Lutnick also accused China of “slow-rolling” negotiations.China dismissed the claims as “seriously contrary to the facts” and criticised Washington’s “bogus charges.”

The renewed tension revived fears of a full-blown trade war, overshadowing positive inflation data from the US.Markets across Hong Kong, Tokyo, Sydney, Singapore, Taipei, Manila and Jakarta registered declines. Hong Kong’s losses surpassed 2%, led by property stocks amid concerns over New World Development’s delayed bond payments and a broader credit crunch in China’s real estate sector.Oil surged after OPEC’s modest production increase disappointed markets, while escalating Ukraine-Russia hostilities added to the anxiety.

The US dollar weakened amid fears about fiscal sustainability as Trump pushed for extended tax cuts and welfare reforms.Moody’s downgraded the US’s last top-tier credit rating, citing ballooning deficits. JPMorgan CEO Jamie Dimon cautioned that the US bond market could be heading for a crisis. “The bond market is going to have a tough time. I don't know if it's six months or six years,” he said.(With inputs from Bloomberg report)