Asian Stocks Rise with Focus on Earnings, Economic Data
Asian stocks edged higher after the S&P 500 Index rose for a sixth day on optimism that companies will weather slowing economic growth and tariff-driven disruptions.
Australian and Japanese shares rose at the open and Hong Kong stock index futures pointed to modest gains. U.S. stock futures fell slightly after Super Micro Computer Inc. fell in late trading on a disappointing update. Treasury bonds extended gains this month, with the 10-year yield falling for a seventh day. The dollar was little changed after rising on Tuesday. Gold rose and oil fell.
The stock rally faces a major test on Wednesday when the U.S. releases inflation and gross domestic product data, which will give investors clues about how the economy is faring just before President Donald Trump announces a raft of state-specific levies on April 2. In recent weeks, investors have taken comfort in some recent tariff reprieves and growing bets that the Federal Reserve will cut interest rates to stave off a recession.
“Many are still calling for a recession and even a downgrade of equities, but we think the ‘Trump put’ is real for equities while the ‘Fed put’ is real for the economy,” said Andrew Brenner at NatAlliance Securities. “And while tops and bottoms are hard to spot when they’re happening, we think the worst is behind us.” In the latest shift in Trump’s trade strategy, the president signed an executive order easing the impact of his auto tariffs, preventing duties on foreign-made vehicles from piling on top of other levies and leasing costs on foreign parts used to make vehicles in the U.S. Trump also renewed his criticism of Fed Chairman Jerome Powell as he defended his economic policies and tariff regime during an event Tuesday marking his 100th day in office. Trump said China deserved the high tariffs it has imposed on its exports and predicted Beijing could find ways to mitigate the impact on American consumers. In Asian earnings, Samsung Electronics Co.’s chip division reported better-than-expected earnings after Chinese customers rushed to stockpile supplies ahead of U.S. tariffs. Four of the so-called Magnificent Seven — Microsoft Corp., Apple Inc., Meta Platforms Inc. and Amazon.com Inc. — were among the biggest losers. — will also report earnings this week. Analysts expect the group, which also includes Google parent Alphabet, Tesla Inc. and Nvidia Corp., to average 15% profit growth in 2025, a forecast that has barely budged since early March despite rising trade tensions.
Not all companies have had a smooth ride, though.
General Motors Co. and JetBlue Airways Corp. withdrew their outlooks. United Parcel Service Inc. said it expects to cut 20,000 jobs this year.
After the closing bell, Starbucks Corp. reported sales that fell slightly faster than expected. Visa Inc. earnings beat estimates. Snap Inc. declined to issue a sales forecast for the current period, saying it was navigating macroeconomic “challenges” for its advertising business.
Super Micro Computer Inc.’s preliminary results fell short of analysts’ projections. “Going forward, we believe the worst-case scenario for policy changes is likely,” said Lauren Goodwin at New York Life Investments. “But as uncertainty remains high in areas that matter to the market such as business costs and earnings, and as valuations have recovered from recent market lows, market volatility is likely to continue.”
Source: Bloomberg
