Stock market today: Asian shares bounce after Trump’s victory as focus turns to the Fed

Stocks recovered from early losses in Asia on Thursday after US shares raced to records as investors bet on what The return of Donald Trump going to the White House will mean for the economy and the world.

Markets also turned their attention to the Federal Reserve’s decision on interest rates, due to be announced later in the day.

Japan’s Nikkei 225 fell 0.3% to 39,381.41, reflecting concerns about the potential for a revival of trade tensions under the Trump administration.

“I think everyone is going to be concerned about Trump’s tariffs because that’s one of the things in his playbook. And so we’ll have to see how things develop this time in the early stages of his presidency,” said Neil Newman, head of strategy for Astris Advisory Japan.

In Seoul, the Kospi ended almost flat at 2,564.63. The Australian S&The P/ASX 200 rose 0.3% to 8,226.30.

Chinese shares rose after the government reported this exports jumped nearly 13% in October from a year earlier, the fastest pace in more than two years and easily faster than the 2.4% increase in September.

Hong Kong’s Hang Seng gained 1.6% to 20,863.30. The Shanghai Composite index rose 2.3% to 3,460.52.

Trump has pledged to impose blanket tariffs of 60% on all Chinese imports, raising them further if Beijing moves to invade the self-governing island of Taiwan.

Investors add to bets previously built on what the higher rates, lower tax rates and lighter regulations what Trump favors will mean. Higher tariffs on imports from China would further exacerbate the situation burdens facing Beijing as the country struggles to revive slowing growth in the world’s second-largest economy.

But the impact could be less dramatic than feared, Zichun Huang of Capital Economics said in a report.

“We expect deliveries to remain strong in the coming months — any drag from potential Trump tariffs may not materialize until the second half of next year,” Huang said.

Still, higher tariffs on imports from China, Mexico and other countries would increase the risk of trade wars and other disruptions to the global economy.

Trump’s victory raised expectations that Beijing could increase spending and other stimulus measures to counter such trends. The Standing Committee of China’s legislature is meeting this week and is expected to announce further measures on Friday.

Francis Lun, CEO of Geo Securities, said domestic issues are a bigger problem than tariffs. “People want the government to spend some money to stimulate the economy, instead of looking outside,” he said.

Wednesday is Elon Musk’s US stock market Teslabanks and bitcoin it all raced higher as investors placed bets on what Donald Trump’s return to the White House will mean for the economy and the world. Among the losers the market sees: the renewable energy industry and possibly anyone else who is concerned higher inflation.

The S&The P500 rose 2.5% to 5,929.04 for its best day in almost two years. The Dow Jones Industrial Average rose 3.6% to 43,729.93, while the Nasdaq composite rose 3% to 18,983.47. All three indexes surpassed the records they set in recent weeks.

The impact of Trump’s second term will likely depend on whether his fellow Republicans win control of Congress, and they do not yet clear.

Investors may see Trump’s policies leading to stronger economic growth. That helps push prices down and boost yields for government bonds. Tax cuts under Trump could further increase the US government’s budget deficit, increasing borrowing and raising interest rates even further. The yield on the 10-year government bond rose to 4.43% from 4.29% late Tuesday, an important step for the bond market. It has increased significantly from August, when it was below 4%.

Investors expect the incoming president’s policies, especially higher rates, to fuel inflation and raise costs for American households. Sharp cuts in immigration could also leave businesses short of work, forcing companies to raise wages for workers more quickly and putting more upward pressure on prices.

Much of Wall Street’s record attempt this year was based on expectations upcoming interest rate cuts by the Federal Reservewhile inflation has risen back to the 2% target. Looser interest rates help boost the economy, but can also fuel inflation.

The Fed will announce its latest decision interest rates A cut is still expected on Thursday, according to data from CME Group. But traders have already reversed forecasts about how many cuts the Fed will implement by the middle of next year.

In other trades early Thursday, the U.S. dollar weakened against the Japanese yen, from 154.62 yen to 154.08 yen. The euro rose from $1.0730 to $1.0747.

U.S. benchmark crude rose 24 cents to $71.93 a barrel. Brent crude, the international standard, rose 33 cents to $75.25.

Bitcoin’s price fell to $74,789.38 after hitting an all-time high above $76,480 on Wednesday, according to CoinDesk. Trump has promised to make the country ‘the crypto capital of the planet” and create a “strategic reserve” of bitcoin.