Asian shares are mostly down after South Korea makes tariff deal and US
stocks fall
[July 31, 2025] By
TERESA CEROJANO
MANILA, Philippines (AP) — Asian shares were mostly lower Thursday after
U.S. stocks slipped, as doubts rose on Wall Street about whether the
Federal Reserve will deliver economy-juicing cuts to interest rates by
September.
Bucking the trend, Japan’s Nikkei 225 rose 1.1% to 41,075.85 after the
Bank of Japan kept interest rates steady at 0.5% and raised inflation
projections. The move follows Tokyo’s trade deal with Washington.
In Seoul, the Kospi edged down 0.6% to 3,235.83 after South Korea
reached a 15% tariff deal with the U.S., with no levies on American
goods like cars, trucks and farm products. The deal also includes South
Korea's purchase of $100 billion U.S. energy imports and $350 billion
worth of investments in the U.S.
Hong Kong’s Hang Seng index fell 1.1% to 24,814.59, while the Shanghai
Composite Index slid 0.8% to 3,586.13. Australia’s S&P ASX 200 shed 0.2%
to 8,741.90. India's BSE Sensex fell 0.4% to 81,169.49. Taiwan's TAIEX
rose 0.3% to 23,542.52
Rabo Bank, citing the U.S. trade deals with other countries, including
Bangladesh, said in a commentary that “it appears to be only a matter of
time before India agrees to terms to ensure that it retains favorable
access to the US market and all of those other markets that (U.S.
President Donald) Trump has demonstrated he has the power to direct
through economic coercion.”
Rabo added that the terms of a U.S.-India trade deal would almost
certainly include Indian purchases of U.S. arms and energy products and
preferential access to U.S. agricultural goods.
“A potential loser in all of this is Australia. With the US sending more
wheat to Indonesia and Bangladesh and more LNG to Japan and South Korea,
Australian exports stand to be displaced from their traditional
markets,” it added.
Trump on Wednesday announced a 25% tariff on imports coming from India,
along with an additional tax because of India’s purchases of Russian
oil, beginning Friday. That’s when stiff tariffs Trump has proposed for
many other countries are also scheduled to kick in, unless they reach
trade deals that lower the rates. But the U.S. president said the two
countries were still in negotiations.
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Currency traders work near a screen showing the Korea Composite
Stock Price Index (KOSPI), top center left, and the foreign exchange
rate between U.S. dollar and South Korean won, top center, at the
foreign exchange dealing room of the Hana Bank headquarters in
Seoul, South Korea, Thursday, July 31, 2025. (AP Photo/Ahn Young-joon)
 On Wall Street on Wednesday the S&P
500 edged down by 0.1%, coming off its first loss after setting
all-time highs for six successive days. The Dow Jones Industrial
Average dropped 171 points, or 0.4%, and the Nasdaq composite rose
0.1%.
Stocks felt pressure from rising Treasury yields in the bond market
after the Federal Reserve voted to hold its main interest rate
steady. The move may upset Trump, who has been lobbying for lower
interest rates, but it was widely expected on Wall Street.
Fed Chair Jerome Powell may have surprised investors by pushing back
on expectations that the Fed could cut rates at its next meeting in
September. Besides Trump, two members of the Fed’s committee have
also been calling for lower rates to ease the pressure on the
economy, and they dissented in Wednesday’s vote.
But Powell would not commit to a September cut in rates, pointing to
how inflation remains above the Fed’s 2% target, while the job
market still looks to be “in balance.”
A cut in rates would give the job market and overall economy a
boost, but it could also risk fueling inflation when Trump’s tariffs
may be set to raise prices for U.S. consumers. The Fed’s job is to
keep both the job market and inflation in a good place.
In other dealings on Thursday, U.S. benchmark crude oil added 5
cents to $70.05 per barrel while Brent crude, the international
standard, shed 6 cents to $72.41 per barrel.
The U.S. dollar fell to 148.79 Japanese yen from 149.44. The euro
rose to $1.1445 from $1.1412.
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