Asia-Pacific stock markets largely advanced at the open on Friday, buoyed by a fragile agreement between U.S. President Donald Trump and Chinese President Xi Jinping that dialed back escalating frictions over critical minerals. The development, forged during a tense summit in South Korea on Thursday, averted the specter of an all-out trade conflict between the globe’s top two economies, leaving investors to parse the broader economic implications.
The pact centers on rare earth elements, vital for tech and manufacturing, with both nations opting to retain certain restrictions as leverage in ongoing talks. “Both sides appear to be maintaining leverage for future negotiations by keeping these measures as bargaining chips,” observed Chaoping Zhu, global market strategist at JPMorgan Asset Management.
Leading the regional surge, Japan’s Nikkei 225 climbed more than 1% to notch an all-time high, while the broader Topix index gained 0.79%, also touching a new summit. In South Korea, the Kospi edged up 0.22% following its own record close the previous day, with the smaller Kosdaq index advancing 0.47%.
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Australia’s S&P/ASX 200 kicked off trading with a 0.45% increase, reflecting cautious optimism across the Pacific Rim. However, gains were uneven: Hong Kong’s Hang Seng Index dipped 0.33%, and mainland China’s CSI 300 held steady at the open.
Not all corporate news aligned with the upbeat sentiment. Panasonic Holdings shares tumbled over 8% after the company slashed its full-year operating profit outlook by 13.5% on Thursday, as reported by Reuters. The revision stemmed from softer-than-expected earnings at its core energy division, a key supplier of batteries to Tesla and other electric vehicle makers.
Stateside, the previous session offered a sobering counterpoint. Wall Street’s major benchmarks all ended in the red amid a wave of underwhelming Big Tech results. The S&P 500 fell 0.99% to close at 6,822.34, the Nasdaq Composite shed 1.57% to 23,581.14, and the Dow Jones Industrial Average slipped 109.88 points, or 0.23%, to 47,522.12.
As traders navigate this blend of geopolitical relief and earnings scrutiny, the fragile Trump-Xi accord underscores the delicate balance in global trade dynamics. With eyes on upcoming data like China’s PMI readings, the region braces for volatility even as records are rewritten.
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