Tokyo's Nikkei leads Asian rally after Japan-US trade deal
HONG KONG : Tokyo stocks rallied with the yen Wednesday after Japan and the US finally hammered out a trade deal to slash Donald Trump's tariffs, including those on the crucial car sector.
Investors were also cheered by news that Washington had reached agreements with Indonesia and the Philippines, stoking optimism that other countries will achieve deals to avoid the worst of the US president's levies.
Despite a lack of deals being made leading up to Trump's self-imposed Aug 1 cut-off date, equity markets have been on the march in recent weeks on optimism that governments will eventually get over the line.
Japan had been one of those yet to sign, despite a string of trips to Washington by trade envoy Ryosei Akazawa, dampening investor sentiment in Tokyo.
But Trump said Tuesday that officials had agreed to a 'massive' deal that would include a 15% tariff on imports from Japan, down from the previously threatened 25%.
The pact also saw the 25% levy on autos – a major export to the United States – slashed to 15%.
'We just completed a massive Deal with Japan, perhaps the largest Deal ever made,' Trump announced on his Truth Social platform.
'Japan will invest, at my direction, US$550 Billion Dollars into the United States, which will receive 90% of the Profits.'
He did not provide further details on the investment plan, but claimed the deal 'will create Hundreds of Thousands of Jobs.'
Japanese Prime Minister Shigeru Ishiba said that he needed to examine the deal before commenting.
Akazawa wrote on X: 'Mission accomplished.'
Traders poured back into the market, pushing the Nikkei up more than 2% thanks to soaring automakers.
Tokyo and Mitsubishi rocketed around 12% and Nissan jumped more than 9%.
The yen strengthened to 146.20 per dollar – compared with close to 148 Tuesday. The unit had already enjoyed a recent tick-up after Ishiba vowed to remain in office despite a devastating weekend election loss.
Trump also hailed an agreement with Manila that will see the toll on Philippine goods lowered by one percentage point to 19%, while tariffs on Indonesia were slashed from 32% to 19%.
Shares in Manila and Jakarta rose.
The announcements boosted hopes that other deals could be in the pipeline before next Friday's deadline, though talks with the European Union and South Korea remain elusive for now.
Still, US treasury secretary Scott Bessent said he would meet his Chinese counterparts in Stockholm next week for talks, as a separate mid-August deadline approaches for US levies on Beijing to snap back to steeper levels.
Elsewhere in Asia, Hong Kong built on its 2025 surge to hit its highest level since late 2021, while Shanghai, Sydney, Singapore and Taipei were also well up. Seoul was flat and Wellington dipped.
The advances came after a broadly positive day on Wall Street where the S&P 500 hit another peak but the Nasdaq snapped a six-day streak of records.
Eyes are also on the release of earnings from Google parent Alphabet and other tech giants including Tesla and Intel.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Star
an hour ago
- The Star
EU chief von der Leyen heads to Scotland for trade talks with Trump
FILE PHOTO: European Commission President Ursula von der Leyen speaks at a press conference following the 25th EU-China Summit in Beijing, China July 24, 2025. REUTERS/Florence Lo/File Photo BRUSSELS/EDINBURGH (Reuters) -EU Commission President Ursula von der Leyen headed to Scotland on Saturday ahead of a meeting with U.S. President Donald Trump on Sunday afternoon, commission spokespeople said, as EU officials said the two sides were nearing a trade agreement. Trump, in Scotland for a few days of golfing and bilateral meetings, told reporters upon his arrival on Friday evening that he was looking forward to meeting with von der Leyen, calling her a "highly respected" leader. He repeated his view that there was a 50-50 chance that the U.S. and the 27-member European Union could reach a framework trade pact, adding that Brussels wanted to "make a deal very badly". If it happened, he said it would be the biggest trade agreement reached yet by his administration, surpassing the $550 billion accord agreed with Japan earlier this week. The White House has released no details about the planned meeting or the terms of the emerging agreement. The European Commission on Thursday said a negotiated trade solution with the United States was within reach, even as EU members voted to approve counter-tariffs on 93 billion euros ($109 billion) of U.S. goods in case the talks collapse. To get a deal, Trump said the EU would have to "buy down" that tariff rate, although he gave no specifics. EU diplomats say a possible deal between Washington and Brussels would likely include a broad 15% tariff on EU goods imported into the U.S., mirroring the U.S.-Japan deal, along with a 50% tariff on European steel and aluminum. The broad tariff rate would be half the 30% duties that Trump has threatened to slap on EU goods from August 1. It remains unclear if Washington will agree to exempt the EU from sectoral tariffs on automobiles, pharmaceuticals and other goods that have already been announced or are pending. Combining goods, services and investment, the EU and the United States are each other's largest trading partners by far. The American Chamber of Commerce in Brussels warned in March that any conflict jeopardized $9.5 trillion of business in the world's most important commercial relationship. (Reporting by Andrew Gray and Andrea ShalalEditing by Nick Zieminski)
Free Malaysia Today
5 hours ago
- Free Malaysia Today
BN-PH pact likely to continue for GE16, but may change after that, says Zahid
Ahmad Zahid Hamidi said BN is firm on continuing its alliance with PH in the run-up to the next nationwide polls despite calls for it to go solo. PETALING JAYA : While Barisan Nasional plans to continue its alliance with Pakatan Harapan in the next general election (GE16), BN chairman Ahmad Zahid Hamidi says its strategies for elections after that may change. Zahid, the Umno president, acknowledged that there were calls for BN to contest in GE16 on its own, but said the coalition is firm on continuing its alliance with PH. However, he said BN's political strategies for the general elections that follow will be determined by the electoral performance of the parties in the alliance, Berita Harian reported. 'We do not know how many seats we will have, and how many seats they will have. 'Remember that, in Malaysia, differences in views are conventionally based on differing party 'colours'. We are willing to forget our different 'colours' for the sake of political stability,' he was quoted as saying. The Umno-led BN played a crucial role in enabling Prime Minister Anwar Ibrahim to form the unity government in the wake of the 2022 general election, which resulted in a hung Parliament. PH had won 81 parliamentary seats while BN won 30, in what was the latter's worst electoral performance to date.
Free Malaysia Today
5 hours ago
- Free Malaysia Today
It's a no-confidence vote by the rakyat, says Takiyuddin
PAS secretary-general Takiyuddin Hassan said Prime Minister Anwar Ibrahim should take heed of the turnout at today's rally and make the decision to resign. KUALA LUMPUR : PAS secretary-general Takiyuddin Hassan has likened the turnout of nearly 20,000 people at the Turun Anwar rally today as a vote of no confidence against Prime Minister Anwar Ibrahim. Takiyuddin said Anwar should take heed of the turnout at today's rally and make the 'moral decision' to resign instead of waiting for a confidence motion to be brought against him in the Dewan Rakyat. He also dismissed tabling a confidence motion, saying the number of MPs who would vote against Anwar may not reflect the sentiments of Malaysians nor reflect the number of Malaysians who were at the rally today. 'That's why, to us, the real vote of no confidence is from the rakyat. That is what should be considered. When the prime minister sees this many people calling for his resignation, he should pay attention,' rather than wait for action to be taken against him in the Dewan Rakyat, Takiyuddin said when met after the rally ended. The rally at Dataran Merdeka, organised by PAS Youth, was aimed at pressing for Anwar to resign as prime minister. The youth wing claimed that more than 200,000 people took part, although police estimated that just 18,000 rally-goers were present. Anwar had previously dared his rivals to table a parliamentary motion, saying he had already asked Dewan Rakyat Speaker Johari Abdul to give priority to the motion if it was tabled.
