At a time of major changes in US tariff policies, Asian stock markets rallied on Monday, February 23rd, with the US dollar slipping, funds shifting towards gold as a safe haven, and the South Korean and Taiwanese stock markets reaching new highs driven by semiconductor stocks.
Last week, the US Supreme Court ruled that President Trump did not have the authority to impose tariffs under the International Emergency Economic Powers Act, leading him to impose a temporary 15% tariff globally under Section 122.
It is still unclear whether the new tariff rates will provide exemptions for specific countries. Investors are awaiting clearer information from the US. Under the old tariff structure, some countries including the UK and Australia were subject to a 10% tariff rate, while many Asian countries had even higher rates.
Meanwhile, on Wednesday, February 25th, technology giant Nvidia will release its earnings report, which will test market confidence in artificial intelligence (AI).
On Thursday, February 26th, the US and Iran will hold new negotiations in Geneva. Currently, oil prices are temporarily falling, but the risk of military conflict between the US and Iran remains if an agreement cannot be reached.
Despite the policy uncertainties, Asian stock markets shone brightly on Monday. The South Korean KOSPI index continued to rise for the third consecutive trading day, jumping 1.7% at the opening to reach another historic high. Blue-chip stocks SK Hynix and Samsung Electronics rose over 3% and 2% respectively.
The Australian S&P/ASX 200 index rose 0.17% in early trading.
Taiwan also saw a strong surge after opening, reaching a record high of 34,212.38 points.
The Hang Seng Index in Hong Kong also rose over 2%, reaching a high of 27,095.32 points.
The markets in China and Japan were closed due to holidays.
Rodrigo Catril, Senior Foreign Exchange Strategist at National Australia Bank (NAB), told Reuters, “The prospect of tariffs is now more uncertain than before, and uncertainty is not good news for any economy or market.”
He further warned that unless rationality is restored, the market may enter a cycle of “announcing new tariffs, being overturned, and announcing new tariffs again.”
Market analysts point out that if the court ruling requires the US government to refund approximately $170 billion in taxes, the US fiscal deficit as a percentage of GDP could expand to 6.6%.
In the currency markets, the chaos in trade policies has exacerbated the market sentiment of “selling America” in recent months, putting pressure on the US dollar on Monday. The dollar fell 0.4% against the Japanese yen to 154.36, and also declined about 0.4% to 0.5% against the euro and the Swiss franc.
Driven by risk aversion, the price of gold rose 1.16% to $5,167 per ounce.
Energy markets showed volatility as they awaited the new round of US-Iran talks scheduled for Thursday in Geneva. Brent crude oil prices edged down 0.6% to $71.29 per barrel.
US stock futures slipped slightly in early trading on Monday, with S&P 500 index futures down 0.3%, as the market awaited Nvidia’s upcoming earnings report.
Analysts expect Nvidia’s earnings per share to grow by 71%, with this report seen as an important test of global confidence in AI investments.
Looking ahead, experts believe tariffs remain a core strategy for Trump.
Claudio Galimberti, Chief Economist at Rystad Energy, stated in a research report, “While the Supreme Court decision invalidated most current tariffs and weakened the ability to target individual countries, it did not dismantle the overall tariff framework.”
He cautioned that without exemptions, implementing new policies could potentially result in average tariff rates even higher than the previously invalidated structure.