ASIA STOCKS: Asian Equities Fluctuate On Trump Tariff Headlines

Asian markets experienced significant fluctuations Tuesday following U.S. President Donald Trump's warnings of 25% tariffs on Canada and Mexico by February 1, which dented earlier optimism about a gradual trade policy approach. South Korean stocks turned lower as Trump ordered a review of global trade practices, with battery and chemical shares plunging, though chipmakers saw gains. In China, markets briefly pared gains before recovering, supported by hopes that China may avoid immediate tariff measures, although the offshore yuan weakened.

• South Korean stocks fell after initially opening higher, with the KOSPI losing 0.37% by late morning as Trump’s trade policy review rattled sentiment. Battery and chemical shares were among the biggest losers, with LG Energy Solution dropping 5.4% and POSCO Future M plunging 10%. However, chipmakers like SK hynix and Hanmi Semiconductor gained 1.4% and 2.22%, respectively, helping limit broader losses.
• Taiwans TAIEX is little changed today, as TSMC and Hon Hai trades unchanged to 0.20% higher.
• Japanese equities erased early gains as Trump’s tariff threats on Canada and Mexico dashed hopes for a moderate trade policy. Benchmark indices the TOPIX & Nikkei are now trading mixed although wrapped around unchanged for the day. Export-reliant carmakers were among the hardest hit, with Mazda Motor dropping 2.6%, as investors priced in potential risks to U.S.-bound exports.
• Australian equities saw swings with the wider market however are trading 0.50% higher now, led by gains in Financials.
• Trump’s tariff threats on Canada and Mexico weighed heavily on Asian sentiment. The Canadian dollar and Mexican peso tumbled as much as 1.4% and 0.9%, respectively, dragging down global risk appetite and reinforcing concerns about escalating trade tensions.