Asian Markets Rise Despite Wall Street Decline
Asian markets advanced on Friday, shrugging off another decline on Wall Street. The gains came after China's financial regulators ordered state-run banks and other institutions to boost consumer spending.
Hong Kong's benchmark Hang Seng Index jumped 2.5%, while the Shanghai Composite Index surged 1.9%. The National Financial Regulatory Administration issued a notice urging financial institutions to develop consumer finance, encourage credit card use, and be more transparent in their lending practices.
Economists believe China needs consumers to spend more to stimulate the economy. However, many advocate for broader reforms such as increasing wages, social welfare, and support for public health and education.
In other Asian markets, Tokyo's Nikkei 225 added 0.9%, while South Korea's Kospi slipped 0.2%. Australia's S&P/ASX 200 gained 0.6%, Bangkok's SET jumped 0.9%, and Taiwan's Taiex was up 0.3%.
Wall Street's Sell-Off Deepens
On Thursday, Wall Street's sell-off deepened as President Donald Trump's escalating trade war dragged the S&P 500 more than 10% below its record high. The index fell 1.4%, marking its first correction since 2023.
The losses came after Trump threatened 200% tariffs on European wines and alcohol unless the EU rolls back tariffs on U.S. whiskey. This, coupled with uncertainty about the future of Trump's trade policies, led to investor anxiety.
The Dow Jones Industrial Average dropped 1.3%, while the Nasdaq composite fell 2%. The volatility in the market reflects concerns about the potential economic impact of Trump's trade policies.
Mixed Signals on the Economic Front
Despite the market downturn, there were positive economic indicators on Thursday. Inflation at the wholesale level was milder than expected, and fewer U.S. workers applied for unemployment benefits last week. These reports suggest that the job market remains steady.
However, some sectors of the market, such as artificial intelligence and electric vehicles, have experienced significant declines recently. Palantir Technologies, Super Micro Computer, and Tesla all saw their stock prices fall on Thursday.
On a positive note, Intel's stock jumped 14.6% after naming Lip-Bu Tan as its new CEO. Tan will take over the role next week, facing the challenge of reviving the once-dominant chipmaker.