Asian Markets React to Potential US-China Trade Talks

HONG KONG, China – On May 2, 2025, Asian stock markets responded positively as news broke regarding potential trade negotiations between the United States and China. Despite earlier losses in US stock index futures, the S&P 500 and Nasdaq 100 E-mini futures recovered, each gaining momentum of 0.6% and 0.3%, respectively.

The rise followed an announcement from China’s Commerce Ministry, which stated it was evaluating the possibility of trade talks with the US. This news fueled optimism among investors, contributing to a robust opening on the Hong Kong stock market. The Hang Seng Index increased by 1.6%, reaching nearly a one-month high amid easing US-China trade tensions.

Meanwhile, Japan’s Economy Minister Akazawa confirmed that the country had concluded its second round of trade negotiations with the US. Although he did not provide specifics on the discussions, he noted that the next meeting is set for after mid-May, which has positively influenced Japan’s Nikkei 225 index, rising 1.1% in early trading.

The US dollar also bounced back, significantly influenced by a sharp decline in the Japanese yen. The Bank of Japan maintained its interest rates steady but drastically lowered its fiscal year growth forecast from 1.1% to 0.5%, citing uncertainties related to trade tariffs. The yen fell 1.6% against the dollar, reaching 145.40 on May 1, marking its steepest drop this year.

In commodities, gold prices continued to struggle, dropping for the third consecutive session and reaching a near two-week low of $3,201. However, it experienced a slight recovery of 0.5% in early trading to $3,254. Market analysts are closely watching key US jobs data scheduled for release later in the day, which could further influence trading conditions.

Despite the recent declines in gold prices, the market may see a shift if the commodity manages to stay above critical support levels. A failure to hold above $3,162 could signal a more significant downturn, with possible testing of support at $3,086.