A screen reflecting on glass displays the Hang Seng stock index at the Central district in Hong Kong, China, April 7, 2025. REUTERS/Tyrone Siu/File Photo
- Summary
- Companies
- Japan’s Nikkei underperforms as yen strengthens on safe-haven demand
- Appeals court reinstates duties a day after trade court halted them
- Analysts say court drama mostly just adds to market uncertainty
TOKYO, May 30 (Reuters) – Stocks slipped in Asia on Friday and the U.S. dollar drooped with Treasury yields as investors digested an appeals court decision to keep President Donald Trump‘s tariffs in effect, a day after markets rallied on a ruling to block most of them.
Japan’s Nikkei (.N225) attracted sellers, following a nearly 2% rally on Thursday, with moves in the exporter-heavy index exacerbated by the ebb and flow in demand for the safe-haven yen.
The United States Court of Appeals for the Federal Circuit in Washington temporarily reinstated Trump’s duties on Thursday while it considers the government’s appeal. On Wednesday, a little-known trade court blocked on the ground that Trump had overstepped his authority, and tariffs were the jurisdiction of Congress, not the president.
Either way, senior Trump administration officials said they were undeterred and expected either to prevail on appeal or to employ other powers to ensure the tariffs remain.
The Nikkei dropped 1.1% after the yen appreciated as much as 2% from its low on Thursday to change hands as strong as 143.45 per dollar . A stronger yen reduces the value of overseas revenues for Japanese companies.
Hong Kong’s Hang Seng (.HIS) sank 1.6%, with Apple suppliers slumping on the tariff reversal. Mainland Chinese blue chips (.CSI300) eased 0.3%.
South Korea’s KOSPI (.KS11) fell 0.9%.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was off 0.6%.
“Trump’s trade agenda remains alive and kicking, with the legal battle adding yet another layer of uncertainty,” said Rodrigo Catril, senior FX strategist at National Australia Bank.
“The only thing that looks more certain is more uncertainty,” which will lead to additional delays in investment decisions and hiring, he said.
U.S. S&P 500 futures fell 0.1%. The cash index (.SPX) rose 0.4% overnight, but that was largely the effect of resilient Nvidia (NVDA.O) financial results from after the market close on Wednesday, to which Asian shares already had a chance to react.
Pan-European STOXX 50 futures edged very slightly lower.
The 10-year U.S. Treasury yield was steady at 4.42% on Friday, following a 5.5 basis point slide on Thursday.
Both Brent and U.S. West Texas Intermediate crude eased 0.3% on Friday, to $63.95 and $60.75 per barrel, respectively.
Despite the uncertainty injected by the courtroom drama, the Trump administration said negotiations with top trading partners continue unabated. Treasury Secretary Scott Bessent noted during an interview with Fox News that he is scheduled to have talks with a high-level Japanese delegation later on Friday in Washington.
Trump had already paused his “Liberation Day” tariff rates on most trade partners for 90 days to July 9 and set a baseline rate of 10% in the meantime in order to give time for some of them to hammer out deals.
So far though, apart from a broad agreement with Britain, deals remain elusive. Bessent said in the interview with Fox News that talks with China are “a bit stalled,” and may need the direct involvement of Trump and Chinese President Xi Jinping to get across the finish line.
Reporting by Kevin Buckland; Editing by Jamie Freed
Our Standards: The Thomson Reuters Trust Principles.
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