Asian stock markets mostly declined on Monday, following a modest rebound in U.S. technology stocks that helped Wall Street snap a four-week losing streak. Investors across the region remained cautious as they awaited further developments on U.S. President Donald Trump’s tariffs, with reports suggesting that his administration might narrow the scope of the tariffs to target countries with significant trade surpluses with the U.S., many of which are in Asia.
Trump has set an April 2 deadline for imposing additional tariffs on trading partners, continuing a pattern of previous tariff deadlines that have been delayed or postponed at the last minute. Meanwhile, Chinese Premier Li Qiang sought to ease tensions during a meeting with business leaders and U.S. Senator Steve Daines, a staunch supporter of Trump, marking the first visit by a U.S. lawmaker to Beijing since Trump took office in 2017.
During the meeting, Li stressed the importance of dialogue over confrontation and emphasized the need for win-win cooperation between China and the U.S., as the two nations stand at a critical juncture in their relations. He expressed hope that the U.S. would work with China to foster steady and sustainable development in bilateral ties.
The meeting also included key representatives from major U.S. corporations, such as FedEx CEO Raj Subramaniam, Boeing’s Brendan Nelson, Qualcomm’s Cristiano Amon, and Pfizer’s Albert Bourla. Despite growing optimism that Trump’s tariff plans may be less severe than initially feared, markets in China continued to lose momentum. Hong Kong’s Hang Seng Index fell 0.3% to 23,613.50, and the Shanghai Composite Index dropped by 0.3% to 3,356.50.
Mixed Market Response to U.S. Economic Outlook
In Japan, the Nikkei 225 closed nearly unchanged at 37,676.97, despite a preliminary manufacturing report revealing the sharpest drop in output in a year, with new orders also falling at an accelerated pace. Taiwan’s Taiex gained 0.1%.
In contrast, U.S. stock futures showed early gains as investors anticipated more clarity on tariff policies. On Friday, the S&P 500 closed up by 0.1% at 5,667.56, marking a 0.5% weekly gain but still down 4.8% for the month. The Dow Jones Industrial Average added 0.1%, closing at 41,985.35, while the Nasdaq Composite rose by 0.5% to 17,784.05.
The rebound in technology stocks, including a 2% rise in Apple and a 1.1% gain for Microsoft, provided some relief for the S&P 500 after weeks of declines, primarily driven by concerns about the U.S. economy and ongoing trade uncertainties. Technology stocks, long the market’s driving force, have been particularly volatile recently, reversing much of their previous gains.
Despite the positive performance in tech, Nvidia fell 0.7%, and Micron Technology saw a sharp 8% decline, marking the biggest drop in the S&P 500. Investors continue to grapple with uncertainty about the economy, particularly regarding the trade war’s impact on inflation and consumer and business costs.
U.S. Economic Data Offers Mixed Signals
Recent U.S. economic data has shown resilience, with reports on home sales, industrial production, and unemployment suggesting that the economy remains robust. However, consumer sentiment and retail sales data have indicated growing caution among consumers, who are feeling the effects of high inflation and rising interest rates.
Several companies, including homebuilder Lennar, have warned investors about the challenges posed by tariffs, inflation, and economic uncertainty. Lennar’s shares fell by 4% after it issued a weaker-than-expected forecast for new orders and average sales prices, citing the ongoing pressures from high interest rates and a slowing housing market.
Oil Prices Slip Amid Economic Concerns
In early Monday trading, U.S. benchmark crude oil dipped 22 cents to $68.06 per barrel, while Brent crude, the international benchmark, dropped 30 cents to $71.86 per barrel. Concerns about global economic growth and the potential impact of tariffs on trade have kept pressure on oil prices.
The U.S. dollar strengthened against the Japanese yen, rising to 149.78 from 149.37, while the euro edged up slightly to $1.0823 from $1.0816.
Outlook for Markets
As markets await further developments on the U.S. tariff front, along with upcoming U.S. economic data, investors are likely to remain on edge. Geopolitical tensions, trade uncertainty, and inflationary pressures continue to weigh on global markets, with many looking for signs of stabilization in the coming weeks. The potential narrowing of Trump’s tariff plans may offer some relief, but uncertainty around trade relations and economic growth remains a dominant theme.
