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Asian stocks rose on Tuesday after US President Donald Trump paused tariffs on Canada and Mexico and hinted at a deal over social media platform TikTok.
Trump halted tariffs just hours before they were due to come into force. His reversal followed a weekend announcement of huge levies on Canada, Mexico and China that had rattled markets.
The benchmark Hang Seng index climbed 3.3 per cent on Tuesday, Japan’s exporter-oriented Nikkei 225 index rose 1.6 per cent and South Korea’s Kospi gained 1.7 per cent after the impending tariffs were paused. Taiwan’s benchmark Taiex gained 0.6 per cent. China’s markets are closed for a holiday. US equities had recovered some of their losses overnight.
Trump’s 10 per cent tariffs on China are still scheduled to take effect, as are new policies aimed at ending the “de minimis” rule that exempts imports worth under $800 from US duties. The US president is expected to speak to China’s leader Xi Jinping in the coming days.
“Based on the Canada and Mexico situation, the market is expecting there is at least the possibility of a deal with China,” said Jason Lui, head of Asia-Pacific equities and derivatives strategy at BNP Paribas.
Chinese technology stocks led Tuesday’s gains, with Trip.com, Tencent, BYD and JD.com among the best-performing companies during the morning session in Hong Kong. State-owned Chinese chipmaker SMIC rose 8 per cent.
The surge in Chinese tech stocks followed a post on Trump on TikTok. “GREAT INTEREST IN TIKTOK! Would be wonderful for China, and all concerned,” Trump wrote on Truth Social.
Trump has said that tariffs on China could hinge on a deal over TikTok’s ownership. Within hours of his inauguration last month, Trump postponed a deadline requiring TikTok’s Chinese parent company ByteDance to sell its stake in the app or face a ban in the country.
“There is lots of optimism on local [Chinese] tech,” said Wee Khoon Chong, a senior markets strategist at BNY. “There’s a sense of optimism that if [Chinese AI company] DeepSeek can make it then maybe it’s not so bad after all.”
Japanese and South Korean carmakers have also recovered, after being among the worst-hit stocks on Monday as tariffs threatened their North American supply chains that rely on the free flow of goods.
Toyota Motor climbed 2.9 per cent after falling as much as 5.4 per cent on Monday. Kia Motor edged up 2.3 per cent after a 5.8 per cent loss on Monday.
Chipmakers also rose, with Taiwan Semiconductor Manufacturing Co gaining 1.6 per cent and Samsung Electronics rising 4.3 per cent. SK Hynix gained just 0.8 per cent.
Australian and New Zealand benchmark indices rose 0.4 per cent and 0.2 per cent, respectively.
