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Asian equities exhibited a mixed performance on Wednesday, as markets reacted to renewed uncertainty over U.S. President Donald Trump’s shifting trade policies. Losses were led by stocks in Australia and Malaysia, while South Korean shares rebounded, buoyed by modest gains in U.S. tech giants.
The backdrop to the market action was set by major U.S. indexes, which extended their steep sell-off on Tuesday after Trump’s fluctuating tariff signals rattled global investors. On Tuesday, Trump announced an increase in tariffs on Canadian steel and aluminum imports to 50%, only to retract the decision hours later and reinstate the original 25% tariffs. This abrupt policy reversal spurred volatility and prompted investors to reassess the risks associated with international trade.
In Asia, markets that are particularly sensitive to global trade dynamics reacted negatively. China’s Shanghai Composite inched 0.2% lower, while the Shanghai Shenzhen CSI 300 dropped 0.3%. Hong Kong’s Hang Seng index remained largely muted. Malaysia’s KLCI index fell by 1.5%, and the Philippines’ PSEi Composite declined by 1.2%.
Australian equities were also hit, with the S&P/ASX 200 slipping as much as 1.6% on Tuesday and briefly entering correction territory before trading 1.3% lower at 7,786.30 points. This drop came after Prime Minister Anthony Albanese confirmed that Australia would not impose reciprocal tariffs on the U.S., despite earlier speculation that exemptions might be considered.
In contrast, South Korea’s market showed resilience as the KOSPI rallied 1.6%, led by tech heavyweights Samsung Electronics and SK Hynix, which gained 2.1% and 4.5%, respectively. U.S. tech stocks, including NVIDIA, Broadcom, and Tesla, also posted slight rebounds on Tuesday, contributing to a recovery in the Asian tech sector. Japan’s Nikkei 225 recovered with a 0.3% gain after hitting a six-month low, and TOPIX advanced by 0.9%. Meanwhile, futures for India’s Nifty 50 edged up 0.2% on Wednesday.
Overall, the market mood remains cautious as investors navigate the unpredictable environment created by shifting U.S. tariff policies and trade tensions, even as select tech sectors show signs of recovery.
