(Bloomberg) -- Asian equities look mixed after Wall Street rallied for a second day. Pressure eased on the region’s currencies after a report that President-elect Donald Trump’s proposed tariff plan will be watered down.
An index of dollar strength fell as much as 1% Monday after the Washington Post reported that Trump aides were exploring tariffs that only cover critical imports. Trump then denied the report, leading the currency to pare losses to 0.6%, its worst day since November.
Sydney shares edged higher, while equity futures showed heathy gains for Tokyo shares and a decline in Hong Kong’s. In the US, while dip buying fueled tech gains in the S&P 500’s most-influential group, the majority of the benchmark’s shares retreated. Nvidia Corp. hit a record high ahead of chief Jensen Huang’s speech.
The dollar moves offer a reprieve for Asian currencies after a gauge hit its lowest in almost two decades against the greenback on Monday. Traders are concerned about the the impact of Trump’s proposed tariffs, which could threaten potential Federal Reserve interest rate cuts and US-China relations.
The S&P 500 rose 0.6%. The Nasdaq 100 added 1.1%. The Dow Jones Industrial Average was little changed. American Airlines Group Inc. rallied on a trio of analyst upgrades. $Citigroup Inc(C-N)$. also jumped on a bullish call. Tencent Holdings Ltd. depositary receipts slid as the US added company to its Chinese military blacklist.
The past two days’ recovery “shows just how strong the ‘buy the dip’ mentality still is,” said Mark Hackett at Nationwide. “Investors continue to lean heavily on tech. Looking ahead, 2025 won’t be a year for easy double-digit gains by solely investing in the S&P 500. Success in this market will require more discipline and creativity from investors.”
The yield on 10-year Treasuries rose three basis points to 4.63%. Bitcoin topped $100,000. Oil halted a five-session rally.
The Canadian dollar advanced after Prime Minister Justin Trudeau announced his resignation as head of the Liberal Party, triggering a contest to replace him.
In Asia, China reaffirmed its support for the yuan after the currency’s slide last week fanned speculation policymakers would allow it to depreciate faster. The People’s Bank of China set its daily reference rate stronger than the line of 7.2 per dollar, defying speculation it would weaken the so-called fixing.
The yen slid the most among its major peers as traders in Tokyo returned from the holiday season. The Japanese currency weakened as much as 0.4% to 157.83 per dollar on Monday in Tokyo as traders reacted to strong US data released during the holiday last week. The yen may continue to weaken ahead of US jobs data on Friday, according to strategists.
Friday’s report is expected to show employers tempered hiring to wrap up a year of moderating yet still-healthy labor market. The data is unlikely to alter the view of Fed officials that they can slow the pace of rate cuts amid a durable economy and inflation that’s dissipating only gradually.
Fed Governor Lisa Cook said Monday that policymakers can proceed more cautiously amid a sturdy labor market and lingering inflation pressures.
Corporate Highlights:
Key events this week:
Some of the main moves in markets:
Stocks
Currencies
Cryptocurrencies
Bonds
This story was produced with the assistance of Bloomberg Automation.
--With assistance from Richard Henderson.
©2025 Bloomberg L.P.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.