Shares in Asia rebounded on Thursday after early losses, following a surge in U.S. stocks to record highs as investors speculated on the potential impact of Donald Trump's return to the White House on the economy and global markets. The focus also shifted to the Federal Reserve's upcoming decision on interest rates.
Japan's Nikkei 225 declined by 0.4% amid concerns about a resurgence of trade tensions under a Trump administration. In contrast, South Korea's Kospi rose by 0.5%, and Australia's S&P/ASX 200 edged 0.1% higher. Chinese shares also climbed, with Hong Kong's Hang Seng and Shanghai Composite index both gaining 0.9%.
The rally in share prices was supported by China's robust export data, showing a nearly 13% increase in October compared to a year earlier, the fastest growth in over two years. Despite Trump's threats of imposing tariffs on Chinese imports, analysts believe the impact may not be immediate and could materialize in the latter part of next year.
Trump's victory has raised expectations of increased stimulus measures by Beijing to counter potential trade disruptions. However, concerns remain about the risk of trade wars and global economic instability due to higher tariffs on imports from China and other countries.
In the U.S., the stock market, including Tesla, banks, and bitcoin, surged on Wednesday in anticipation of Trump's policies driving economic growth. The S&P 500, Dow Jones Industrial Average, and Nasdaq composite all reached record highs, fueled by optimism about Trump's second term and potential Republican control of Congress.
Investors anticipate Trump's policies, such as higher tariffs, could lead to inflation and higher household costs. The Federal Reserve is expected to announce a decision on interest rates, with market expectations leaning towards a rate cut. However, forecasts for future rate cuts have been tempered.
Amid these developments, the U.S. dollar weakened against the Japanese yen, while the euro strengthened. Crude oil prices also saw gains, with U.S. benchmark crude rising to $72.14 per barrel and Brent crude reaching $75.47.
Bitcoin prices fluctuated, slipping from an all-time high but remaining above $75,000, as Trump expressed ambitions to position the U.S. as a leading hub for cryptocurrencies.
