Stocks extend gains despite US steel tariffs

Market statistics displayed on a screen of the New York Stock Exchange (NYSE) at the opening bell on June 2, 2025, in New York City. [AFP] Stock markets extended gains Wednesday as investors shrugged off US President Donald Trump's tough words on China and the doubling of tariffs on global steel and aluminium. With Trump possibly speaking with Chinese President Xi Jinping this week, the US leader said on his Truth Social platform that it was "extremely hard to make a deal" with his counterpart. US-China tensions have ratcheted back up after Trump accused Beijing of violating an agreement that led to a dialling down of tit-for-tat tariffs between the world's two biggest economies. Also on Wednesday, Trump doubled global tariffs on steel and aluminium to 50 per cent, ramping up his trade war with foes and allies alike. EU trade commissioner Maros Sefcovic and US Trade Representative Jamieson Greer held talks on the sidelines of an OECD ministerial meeting in Paris. Sefcovic said in a news conference that the EU "strongly" regrets the tariff increase, adding that it "doesn't help the ongoing negotiations, especially as we are making progress". Asian and European stock markets rose, however, after Wall Street was lifted on Tuesday by data showing US job openings unexpectedly rose in April. The figures calmed worries about the impact of Trump's tariff blitz on the world's number one economy, even as the OECD cut its growth forecast for the United States. The reading came ahead of crucial non-farm payrolls figures Friday, which are closely followed by the US Federal Reserve as it maps monetary policy in light of weak growth and fears of tariff-fuelled inflation. "Growth is sputtering, the second half looks increasingly cloudy, and everyone knows the Fed's rate-cut cavalry will ride in eventually," said Stephen Innes at SPI Asset Management. "It's already priced, already scripted -- no one's shocked by the plot twist unless, of course, inflation proves stickier than expected," he added in reference to the Federal Reserve planning more cuts to US borrowing costs. "But what's genuinely keeping equities ticking higher is the soft hum of hope -- that US-China tensions could thaw into something warmer than their current frosty detente," Innes added. Ahead of the jobs data, the European Central Bank is widely expected to cut eurozone interest rates on Thursday. Elsewhere, Seoul's stock market rallied more than two percent -- pushing into a bull market after rising more than 20 per cent from its recent low in April -- as Lee Jae-myung won South Korea's snap presidential election. The won gained against the dollar. The poll was called after the impeachment of predecessor Yoon Suk Yeol over his brief martial law attempt and ended six months of political turmoil in the country. It has also raised hopes that Lee will introduce fresh measures to boost the export-dependent economy, which faces a hefty hit from Trump's tariffs, particularly the huge levies on steel and aluminium. In Lee's inauguration speech on Wednesday, the new president warned that protectionism posed a threat to the country's "survival". On the campaign trail, Lee said Seoul needed to start tariff negotiations with Washington "immediately" but also stressed there was no need to "rush" a deal.

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