Latest News

Nvidia helps Asia shares to a high, as investors are unfazed with Trump's tariff moves

Asian stocks rose on Thursday on the back of optimism following Nvidia's rise to a record $4 trillion valuation. Investors also shrugged off President Donald Trump's recent tariffs.

U.S. Copper Futures increased their premium over the London benchmark overnight, after Trump announced his plans to impose 50% tariffs on copper. Later, on Wednesday, he said that the tariffs would be in effect from August 1.

Trump's trade anger also erupted against Brazil on Wednesday, as he issued notices of tariffs and threatened to impose a 50% penalty on Brazilian exports.

The recent moves have not caused much of a stir in the markets. MSCI's broadest Asia-Pacific share index outside Japan is up 0.2%.

The Nikkei Index fell 0.56%. China's blue-chip CSI300 index increased 0.2%, and Hong Kong’s Hang Seng Index rose 0.1%.

Futures on the EUROSTOXX50 index gained 0.18%, while those of the FTSE Index advanced 0.33%.

Nvidia, a designer of artificial intelligence chips, became the first company in history to reach a market capitalization of $4 trillion on Wednesday. It also cemented its place as one Wall Street's favourite stocks.

U.S. Stock Futures Weakened in Asia on Thursday. Nasdaq and S&P 500 Futures each fell about 0.2% after both indexes had closed higher overnight.

Jeff Ng of SMBC, Asia macro strategy head, said that investors are "numb" about the constantly changing situation.

"They know there is still room to negotiate." Many of these announcements start with impressive numbers but are not final and are subject to change. "Even if implemented, these changes could be reversed within the next few months or even a year," said he.

Expectations of Federal Reserve rate reductions later in the year also kept stocks supported.

The minutes of the Fed meeting held last month showed that "most participants" expected rate cuts to occur later this year. Any price shocks from tariffs are expected to be "temporary and modest".

Ng stated that markets do not currently price in a large chance of a full blown recession, as the labour market is still quite resilient. However, they are aware that there is a lot pressure on policy rates to drop, which could reduce the opportunity costs of holding stocks.

DOLLAR EASES

The dollar fell 0.4% to 145.79 yen on Thursday after Trump's 25% tariffs on Japan earlier in the week.

The euro rose 0.17%, to $1.1742. Sterling gained 0.11%, to $1.3605.

The Brazilian real was an exception, as it sank to a low of 5.5826 dollars per Brazilian real in response to Trump's threat of tariffs on Latin America's biggest economy.

Julia Wang, Global Market Strategist at J.P. Morgan Private Bank, said: "Despite the S&P 500’s impressive rally the U.S. Dollar continues to retreat. This highlights a changing global macro narrative."

We believe that the dollar is still 5-15% undervalued. We expect further weakness as cyclical trends and capital reallocation play out.

Bitcoin was near its record high at $111,234.63, and ether rose 1.3% to 2,775.54.

"We are seeing our clients adopt a more measured strategy, choosing to allocate their funds strategically into cryptocurrencies that have real utility rather than chasing after short-term movements. Bitcoin is still the most popular choice on OKX Singapore's platform, according to Gracie Lin.

Brent crude futures fell 0.16% on Thursday to $70.08 a barrel. U.S. crude dropped 0.22% to $68.02 a barrel.

Spot gold increased 0.3% to $3322.69 per ounce.

(source: Reuters)