Tokyo: After a temporary halt in the US and China trade war eased concerns about a global recession, Asian stocks joined the global rally and the US dollar held on to most of its gains on Tuesday ( May 13 ).
The tech-heavy Taiwan also increased by 2 percent, while China’s stocks edged up in earlier dealing, while Japan’s Nikkei increased by 2 percent, touching its highest level since Feb 25.
In early trading, Singapore’s Straits Times Index (STI ) increased by more than 1.5 %.
That left the broadest score of Asia-Pacific shares at a six-month high outside of Japan . After the US and China agreed to reduce tariffs for at least 90 days, the S&, P 500 increased by over 3 %, while Nasdaq increased by 4.3 %.
The voice change from both the US and China was what really made a difference. Phrases like “mutual value” and “demonity” represent a marked change from the new language about confrontation, according to Charu Chanana, chief investment strategist at Saxo in Singapore.
Although there are still questions raised about tariffs, the US announced it had cut them from 145 to 30 percent while China announced it would reduce duties on US imports from 125 to 10 percent, giving relief to the industry.
The US money quickly jumped to the yen, euro, and European franc following the announcement of the deal, but on Tuesday morning, it was somewhat weaker, holding onto the majority of its gains.
Some economists cited the confusion brought on by the still-in effecting tariffs.
According to Christopher Hodge, key US economist at Natixis,” A de-escalation was expected and I think it’s clear that won’t get much sturdy coming out of these discussions.”
” When all is said and done, tariffs will still be significantly higher and will have an impact on US growth,” the statement read.
Fitch, a rating agency, estimated that the US effective tariff rate is now 13.1 %, which is a significant decrease from the previous level of 22.8 %, but it is still at levels that were last seen in 1941 and significantly higher than the 2.3 % it was at the end of 2024.