Asian markets are experiencing a vibrant surge, with significant gains across the board. Japan’s Nikkei 225 leaped by 7.38%, while the broader Topix index increased by 7.12%. South Korea’s Kospi rose by 5%, and the tech-centric Kosdaq saw a notable gain of 4.61%. This bullish trend follows a massive rally on Wall Street after US President Donald Trump announced a temporary halt on tariffs for several countries, sparking optimism among investors. Meanwhile, Hong Kong’s Hang Seng opened with a 2% increase, but all eyes remain on the Chinese markets, given that Trump’s announcement excluded China from the tariff pause.

Wall Street’s Impact on Asian Markets

The positive momentum in Asian markets reflects the robust performance seen in the US. The S&P 500 soared nearly 10%, marking its largest single-day increase since 2008. This surge also stands as the third-largest gain in the index’s history since World War II. The Dow Jones experienced a nearly 8% rise, achieving its most significant percentage jump since March 2020. The tech-heavy Nasdaq Composite skyrocketed by 12%, the highest one-day gain since January 2001.

Trump’s Tariff Announcement

In a surprising move, President Trump declared a 90-day pause on reciprocal tariffs for over 75 nations, with the notable exception of China. He criticized Beijing for its alleged unfair trade practices and announced an immediate increase in tariffs on Chinese goods to an astounding 125%. On his Truth Social platform, he stated, “China has shown no respect to the global market. The days of ripping off the USA are over.”

Clarification on Tariff Decisions

Trump elaborated that the pause was a strategic decision to foster fair negotiations, as many countries had engaged in discussions with the US on trade without retaliating. He announced a temporary reduction of tariffs to 10% for this 90-day period to encourage constructive dialogue.

China’s Reaction and New Tariffs

In retaliation, China has implemented an 84% tariff on American goods, a significant increase from the previous 34%. These tariffs are set to take effect on April 10. Furthermore, China has added 12 US companies to its export control list and categorized six American firms as ‘unreliable entities,’ escalating the ongoing trade tensions.

Federal Reserve’s Cautious Stance

In related news, the US Federal Reserve released its minutes from the March FOMC meeting. The majority of policymakers agreed on the need to slow down the withdrawal of balance sheet support, emphasizing caution amid the ongoing uncertainty regarding the debt ceiling.

Currency and Oil Market Movements

The US Dollar Index (DXY), which measures the dollar against a range of six major currencies, slipped 0.17% to 102.73 on Thursday. In contrast, the Indian rupee appreciated by 0.49%, closing at Rs 86.69 against the dollar. Currency traders are closely monitoring the evolving tariff situation between the US and China for insights on future dollar trends.

In the oil market, prices remained stable early Thursday. WTI crude saw a slight decline of 0.18%, trading at $65.35, while Brent crude dipped 0.67% to $61.99.

Indian Markets on Holiday

In India, both the NSE and BSE are closed today, April 10, in observance of Mahavir Jayanti, a national public holiday. Trading will resume on Friday, April 11. On the previous day, Indian equity indices closed lower, with the Sensex dropping 379.93 points to finish at 73,847.15 and the Nifty 50 falling 136.70 points to end at 22,399.15.

FII and DII Trends

Foreign Institutional Investors (FIIs) continued to withdraw from Indian equities, pulling out Rs 4,358 crore on April 9, marking their eighth consecutive session of selling. Conversely, Domestic Institutional Investors (DIIs) provided some support, purchasing stocks worth Rs 2,976 crore during this period.

This dynamic landscape of market shifts and tariff negotiations highlights the intricate interplay of global economics and the ongoing impact of geopolitical events.