Asia markets climb on US-Japan tariff deal and China trade talk momentum; U.S. futures edge higher

Asia-Pacific markets traded higher on Wednesday following Tuesday’s announcement by US President Donald Trump of a major tariff deal with Japan, including a 15% levy on Japanese exports, while US–China trade talks are also gaining momentum ahead of the August 12 deadline. Gold dipped to around $3,420 per ounce on Wednesday, snapping a three-day winning streak and pulling back slightly from a five-week-high. Japan ( NKY:IND ) and Topix indexes rose 3.64% , with the latter reaching one-year highs. The Japanese yen held its recent advance to around 146.5 per dollar on Wednesday, hovering at a near two-week high following news of a trade agreement between the US and Japan. President Donald Trump announced a trade agreement with Japan that includes a 15% tariff on Japanese exports to the US. He also said Japan will invest $550 billion into the US and open its markets to key American goods. Japan has agreed to import more U.S. rice within its existing tariff-free quota as part of a broader bilateral trade deal that also includes a reduction in reciprocal tariffs on U.S. and Japanese goods from a previously proposed 25% to 15%. Bank of Japan Deputy Governor Shinichi Uchida signaled caution on further rate hikes, citing “extremely high” uncertainty surrounding U.S. trade policy and its global economic impact. Meanwhile, Japan is investigating nickel-based stainless cold-rolled steel sheets and strips from China and Taiwan, the trade and finance ministries announced Tuesday. This follows a petition from Nippon Steel due to falling domestic demand and cheaper imports. Japanese Prime Minister Shigeru Ishiba is reportedly weighing whether to step down, depending on the outcome of ongoing tariff talks with the U.S., according to the Yomiuri newspaper. China ( SHCOMP ) rose 0.75% to above 3,590 while the Shenzhen Component fell 0.1% to 11,090 on Wednesday, with mainland stocks showing mixed performances as uncertainty over US-China trade relations persisted, and the offshore yuan edged higher to around 7.16 per dollar on Wednesday, hitting its highest level in over two weeks, as investors kept a close eye on developments in US-China trade relations. US Treasury Secretary Scott Bessent recently announced that officials from Washington and Beijing will convene in Stockholm next week for a third round of high-level talks, focusing on securing an extension of the current pause in trade tensions beyond mid-August. Investors are now turning their attention to China’s upcoming industrial profits data, set to be released this weekend. Hong Kong ( HSI ) rose 1.43% to 25,264 in Tuesday morning deals, extending gains for the fourth straight session while staying at their highest level since November 2021. India ( SENSEX ) rose 0.17% India and the UK are set to sign a free trade agreement on Thursday during Prime Minister Modi’s visit to Britain, Reuters said. Under the deal, India will reduce tariffs on British whisky, cars, and certain food items, while the UK will grant duty-free access to Indian textiles and electric vehicles. Australia ( AS51 ) rose 0.77% to above 8,720 on Wednesday, extending gains from the previous session, as sharp advances in gold stocks and heavyweight miners boosted the index. The Australian dollar edged higher to around $0.656 on Wednesday, marking its fourth straight session of gains, supported by improved market sentiment amid fresh global trade developments. The Westpac-Melbourne Institute Leading Economic Index for Australia was flat in June 2025, following an upwardly revised 0.1% gain in May. The Central Bank of Sri Lanka kept its benchmark interest rate unchanged at 7.75% during its July 2025 meeting, aiming to steer inflation toward the 5% target while supporting the ongoing economic recovery. Indonesia has agreed to eliminate tariffs on over 99% of U.S. goods and remove all non-tariff barriers facing American firms, while the U.S. will reduce its threatened tariffs on Indonesian products to 19% from 32%, both countries announced on Tuesday. In the U.S., on Tuesday, all three major indexes ended mixed as the S&P 500 notch a fresh record, rising roughly by 0.1%, the Dow added 170 points, while the Nasdaq 100 slipped 0.5% ahead of key earnings reports from Alphabet and Tesla. U.S. stock futures rise on Wednesday after President Trump announced a trade deal with Japan involving a 15% tariff on all goods, including autos.: Dow +0.33% ; S&P 500 +0.26% ; Nasdaq +0.15% . Currencies: ( JPY:USD ), ( CNY:USD ), ( AUD:USD ), ( INR:USD ), ( HKD:USD ), ( NZD:USD ). More on Asia: Trump says U.S. strikes ‘massive’ trade deal with Japan, imposes 15% tariffs Japan vows more rice imports from U.S. as part of trade deal Japanese PM Shigeru Ishiba to step down RBA holds rates steady, citing unclear inflation picture in July minutes Japan’s core inflation eases to 3.3% in June, slowest pace since March

Source: Seeking Alpha