Asian stocks: Asian stocks seek new direction after weak US data

Indexes rose in Sydney and Tokyo and futures pointed to slight gains for Hong Kong. The S&P 500 climbed 0.2% Tuesday after fluctuating for most of the session to notch up its longest rising streak in almost seven weeks, despite a drop in consumer confidence. The Nasdaq Golden Dragon China Index tumbled for a sixth consecutive day, its longest losing streak in more than a year.

The 10-year US Treasuries yield edged up to 4.33% in early Asian trading after falling in the previous session. The dollar was little changed after ending a four-day rally Tuesday. US copper surged to a record. Oil rose early on Wednesday after an industry report indicated a drawdown in US inventories.

While markets have taken some comfort from President Donald Trump’s recent comments about the “reciprocal” tariffs he is due to announce April 2, Tuesday’s US economic data only adds to concerns investors have about growth in the world’s largest economy. Also, a world-beating rally in Chinese technology stocks is rapidly cooling as the initial shock-and-awe from DeepSeek’s AI model wanes, putting a widely-watched benchmark on the brink of a correction.

“Treading carefully may still be the mantra opted for by financial markets until we see who or what is spared from Trump’s next tariff hit-list,” wrote Tim Waterer, chief market analyst at Kohle Capital Markets Pty. The mixed picture of US macro economic data has kept Treasury yields in check and has limited the upside for the dollar, he wrote.

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The Nasdaq 100 rose 0.5% Tuesday. A gauge of tech megacaps climbed 1.2% as Tesla Inc. extended a five-day surge to 28% while Nvidia Corp. fell.Market forecasters have been split on whether the rebound in equities has further to go. Strategists at HSBC Holdings Plc led by Max Kettner downgraded US stocks to underweight, citing economic concerns. Meanwhile, JPMorgan Chase & Co.’s Ilan Benhamou said it’s time to pause the rally-fading approach as emerging clarity on tariffs alleviates some key risks.“Confidence is a fragile thing,” said Steve Sosnick at Interactive Brokers. “Despite the ever-increasing roles of algorithms and artificial intelligence in the investment process, emotions still play an important role in market behavior. Fear and greed still rule, and their constant tug-of-war has been on full display in both the market and the economy recently.”

To Matt Maley at Miller Tabak, the bounce from a US selloff has been a good one, but investors still need to be sure that the worst is really behind us.

“Markets in the near term are going to be choppy,” said Charles Ashley at Catalyst Funds. “There’s a little bit of paralysis with market participants not knowing what to do because they don’t know what policy is going to go into place. We’re not at the point yet where there’s extreme pricing dislocations to find really good opportunities.”

Consumer sentiment surveys have been dismal of late as households fear a resurgence in inflation from Trump’s tariffs. Companies have warned of higher prices and less demand, coinciding with economists’ forecasts that suggest a risk of stagflation and rising odds of recession.

In Tuesday’s consumer confidence report, the percentage of those expecting lower stock prices in the year ahead surged by more than 10 percentage points.

“Sentiment continues to wane among investors, consumers and businesses as economic concerns and economic policy uncertainty takes its toll,” said Bret Kenwell at eToro. “Until there’s more certainty on the tariff and macro front, sentiment and confidence remain vulnerable.”