Asian markets wobble as Trump-Xi talks offset by Musk row
A person walks in front of an electronic stock board showing Japan’s Nikkei index at a securities firm. (AP Photo/Eugene Hoshiko)
HONG KONG, China — Asian markets stuttered Friday as the stunning public row between the US leader and Elon Musk wiped out optimism from “very positive” talks between presidents Donald Trump and Xi Jinping.
The much-anticipated discussions between the heads of the world’s biggest economies fueled hopes for an easing of tensions. This followed the US leader’s “Liberation Day” global tariff blitz that targeted Beijing particularly hard.
However, investors remained wary after an extraordinary social media row between Trump and billionaire former aide Musk. This saw the two trade insults and threats, and sent Wall Street into the red.
READ: US stocks slump as Tesla shares tank on Trump-Musk row
Wall Street’s three main indexes ended down as Musk’s electric vehicle company Tesla tanked more than 14 percent and the president threatened his multibillion-dollar government contracts.
Asian markets prepare for volatile start to next week
Asian equities fluctuated in early business. Some observers suggesting traders were positioning for what could be a volatile start to next week. This is in light of the row and upcoming US jobs data.
Hong Kong dropped after three days of strong gains, while Shanghai and Taiwan also retreated.
Tokyo, Sydney, Singapore and Wellington rose.
Chris Weston at Pepperstone said that while the call with Xi was “seen as a step in the right direction, (it) proved to offer nothing tangible for traders to work with and attention has quickly pushed back to the Trump-Musk war of words.”
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“It’s all about US nonfarm payrolls from here and is an obvious risk that Asia-based traders need to consider pre-positioning for,” he added.
He said there was a risk of Trump sparking market-moving headlines over the weekend. This, given that he is “now fired up and the risk of him saying something through the weekend that moves markets on the Monday open is elevated.”
Markets will closely follow US jobs figures, which are due later Friday. This, after a below-par reading on private hiring this week raised worries about the labour market and outlook for the world’s top economy.
They come amid bets that the Federal Reserve is preparing to resume cutting interest rates from September. This, even as economists warn that Trump’s tariffs could reignite inflation.
