Japanese equities surged to a record high after the US and China agreed to extend their tariff truce by 90 days, averting triple-digit duties on Chinese exports to the US and lifting sentiment across Asia.
Australia’s ASX extended modest gains, while the Australian dollar remained volatile after the Reserve Bank of Australia, as expected, trimmed its cash rate by 25 basis points to a two-year low of 3.6%.
The Nikkei hit an all-time peak, boosted by strong performances from technology stocks and renewed optimism over trade with the US. China’s blue-chip index advanced 0.5%, while Hong Kong’s Hang Seng was little changed. MSCI’s broadest index of Asia-Pacific shares outside Japan posted a slight increase.
The US-China tariff dispute has played out in a year-long exchange of retaliatory measures, with recent negotiations in Geneva, London, and Stockholm seeking to reduce duties from punitive triple-digit levels. Marc Velan, head of investments at Lucerne Asset Management, noted: “The tariff truce extension was largely priced in, which explains the muted reaction.”
On Wall Street, all three major indices closed lower, weighed down by energy, property, and technology sectors. The Dow Jones Industrial Average fell 0.5% to 43,975.09, the S&P 500 dropped 0.3% to 6,373.45, and the Nasdaq also declined 0.3% to 21,385.40.
In bonds, the yield on the benchmark 10-year US Treasury edged up to 4.289% from 4.286% on Sunday.
