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Asian stock markets were mixed in early trading Thursday, as dovish news from the Fed was overshadowed by growing trade concerns, particularly after reports that the Trump administration was weighing new tariffs of up to 25% on auto imports.
Japan’s Nikkei was down more than 1% in mid-day trading, extending Wednesday’s losses. Automakers led the losses, with Toyota Motor Corp. , Honda Motor Co. and Nissan Motor Co. all down around 2%.
South Korea’s Kospi declined too, as Hyundai Motor Co. slid almost 2% and Kia Motors Corp. dropped about 4%.
Stocks in Hong Kong and mainland China were muted, with the Hang Seng Index and the Shanghai Composite more or less flat. Markets in Taiwan and Singapore were slightly up, while financials weighed down Australia’s S&P/ASX 200 .
Late Wednesday, the U.S. Commerce Department said it was investigating whether steep new tariffs against imported autos are called for, based on national security grounds. “There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry,” Commerce Secretary Wilbur Ross said in a statement.
Investors had already been jittery after President Donald Trump said Tuesday that he was unhappy with trade talks between the U.S. and China and that the June summit with North Korean leader Kim Jong Un might be delayed, as well as reports that the U.S. was considering cutting steel and aluminum imports from the EU by 10%.
The markets were somewhat reassured by comments from the Fed that suggested that it would not rush into interest-rate hikes any quicker than expected.