Asian markets close: Nikkei jumps after US tariff ruling; Sensex gains 321 pts

A wave of optimism swept across most Asia-Pacific stock markets on Thursday, with major indices posting significant gains after a US federal trade court delivered a crucial ruling that President Donald Trump had exceeded his authority with his proposed "reciprocal" tariffs.

This decision, seen as a blow to a key tenet of the president’s economic agenda, provided a strong tailwind for regional equities, including a positive close for Indian benchmarks like the Sensex after an initially volatile session.

The dominant theme driving market sentiment was the US Court of International Trade's decision, which effectively blocked the implementation of Trump's widespread tariff plan.

This development was widely cheered by investors who have been wary of the potential for escalating trade wars and their detrimental impact on global economic growth.

The positive reaction was evident across the region. 

Japan’s benchmark Nikkei 225 surged 1.88% to end the day at 38,432.98, with the broader Topix index climbing 1.53% to 2,812.02. 

South Korea’s Kospi also registered strong gains, rising 1.89% to finish at 2,720.64, while the small-cap Kosdaq climbed 1.03% to 736.29.

Adding to the positive news flow from Seoul, the Bank of Korea cut its policy rate from 2.75% to 2.5% on Thursday, its lowest level since August 2022, a move that was in line with expectations among economists polled by Reuters.

In Greater China, Hong Kong’s Hang Seng index advanced 1.35% to end the day at 23,573.38, while mainland China’s CSI 300 moved 0.59% higher to 3,858.70. 

Australia’s S&P/ASX 200 edged up 0.15% to close at 8,409.8, rounding out a generally positive day for regional bourses.

Indian markets: volatile start, positive finish for Sensex

Indian headline indices, the BSE Sensex and Nifty, experienced a more nuanced trading day.

While they started Thursday with a gap-up opening, buoyed by the strong gains in other Asian markets following the US court ruling, they soon slipped lower before staging a recovery.

The BSE Sensex ultimately ended the session 320.70 points higher at 81,633.02 as of 3:30 p.m. IST.

This came after reaching an intraday high of 81,816 in the initial phase of trading.

Similarly, the NSE Nifty50 settled 81.15 points higher at 24,833.60, after hitting a day's high of 24,889.

Sector-wise, Nifty IT was the biggest sectoral gainer in India, advancing 1.4% in the initial session.

It was followed by Nifty Metal and Nifty Media, which added 0.7% and 0.4%, respectively, while Nifty Pharma also gained 0.3 percent.

However, Nifty Realty was the top loser, down 0.3 percent, followed by a 0.2 percent fall in Nifty Oil & Gas.

Eyes on tech and US market reaction

Investors across the region were also keeping a close watch on Asian chip stocks.

This heightened attention followed a stellar earnings report from US artificial intelligence heavyweight Nvidia on Wednesday, which posted stronger-than-expected earnings and revenue, driven by a remarkable 73% year-over-year surge in its data center business.

The positive sentiment extended to US futures, which rose, buoyed by both the court ruling on tariffs and Nvidia’s strong earnings.

Futures tied to the S&P 500 jumped 1.44%, while Nasdaq 100 futures gained 1.76%.

Dow Jones Industrial Average futures added a significant 483 points, or 1.15%.

This came after a lower close for the three major US stock averages overnight on Wednesday, as investors had parsed the latest earnings reports and Federal Reserve meeting minutes.

On Wednesday, the S&P 500 slid 0.56% to 5,888.55, the Nasdaq Composite shed 0.51% to 19,100.94, and the Dow Jones Industrial Average fell 0.58% to 42,098.70.