Asia-Pacific stock markets began Wednesday’s session with a mixed and cautious performance, as investors grappled with weaker-than-expected US economic data and a fresh tariff threat from US President Donald Trump, this time targeting the crucial semiconductor sector.
While Australian equities managed to hit a new record high, the overall mood was one of uncertainty, with Indian benchmarks like the Sensex poised for a tepid start ahead of a key Reserve Bank of India (RBI) policy decision.
The latest jolt to market sentiment came from President Trump, who signaled a new front in his ongoing trade war. “We’re going to be announcing [tariffs] on semiconductors and chips, which is a separate category, because we want them made in the United States,” Trump said on Tuesday US time.
He added that he would announce the new plan “within the next week or so.” This threat to a globally integrated and highly sensitive industry has added another layer of complexity for investors.
The new tariff comments, combined with weaker-than-expected US economic data, led to losses on Wall Street overnight. All three leading US indexes finished lower on Tuesday.
The S&P 500 fell 0.49% to close at 6,299.19, while the Nasdaq Composite slid 0.65% to end at 20,916.55. The Dow Jones Industrial Average moved 61.90 points lower, or 0.14%, to settle at 44,111.74.
A divergent picture across Asia: Australia hits record, Japan dips
The reaction across Asian markets on Wednesday morning was varied. Australia’s S&P/ASX 200 defied the cautious mood, rising as much as 0.61% to hit a new record high of 8,824 in early trade.
The index was last up 0.38% at the open, with heavyweight stocks like Commonwealth Bank and Westpac Banking Corporation up over 1% and 0.74%, respectively, and mining giant BHP Group 0.28% higher.
In contrast, Japan’s benchmark Nikkei 225 slid 0.12%, though the broader Topix index managed to rise 0.45%. South Korea’s Kospi and the small-cap Kosdaq both saw losses, down 0.64% and 0.57%, respectively.
Indian markets: a muted start expected as RBI decision looms
Indian stock market benchmark indices, the Sensex and Nifty 50, are likely to see a tepid opening on Wednesday, tracking the weak cues from global markets.
The trends on Gift Nifty also indicated a muted start for the Indian benchmark index, with Gift Nifty trading around the 24,688 level, a discount of nearly 20 points from Nifty futures’ previous close.
The primary focus for investors on Dalal Street today will be the Reserve Bank of India’s (RBI) monetary policy decision. In the August RBI policy meeting, the Governor Sanjay Malhotra-led Monetary Policy Committee (MPC) is widely expected to hold its key repo rates unchanged.
This follows a session on Tuesday where the domestic equity market ended lower, with the benchmark Nifty 50 closing below the 24,700 level.
The Sensex had dropped 308.47 points, or 0.38%, to close at 80,710.25, while the Nifty 50 settled 73.20 points, or 0.30%, lower at 24,649.55.
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