Asia Stocks Fall as Tech Weakness and Japan Trade Data Weigh on Sentiment
Asian stock markets retreated on Wednesday after two strong sessions, as technology stocks slipped and investors turned their attention to Japan’s latest trade figures and early policy signals from newly appointed Prime Minister Sanae Takaichi.
The pullback followed a mixed session on Wall Street, where the NASDAQ Composite edged lower amid losses in major tech companies. The S&P 500 finished nearly flat, while the Dow Jones Industrial Average gained slightly thanks to strong corporate earnings. As of 02:55 GMT, U.S. stock index futures traded mostly unchanged, signaling a cautious global mood.
Japan Trade Deficit and Takaichi’s Economic Agenda in Focus
Japan’s trade report showed exports rising for the first time in five months, though growth fell short of expectations. Imports, however, surged above forecasts, resulting in an unexpected trade deficit of 234.6 billion yen ($1.54 billion).
Analysts at ING said the data was “overall positive for growth,” noting that weaker exports to the U.S. were offset by stronger demand from other regions. They expect exports to gradually normalize in the coming months.
Meanwhile, political developments in Tokyo drew close attention as Sanae Takaichi officially became Japan’s first female prime minister. Her 19-member cabinet includes Finance Minister Satsuki Katayama, Foreign Minister Toshimitsu Motegi, and Defense Minister Shinjiro Koizumi.
Takaichi pledged to revive Abenomics-style policies focused on fiscal stimulus and economic security. However, investors remain cautious about whether the new government can balance growth measures with Japan’s high public debt.
“Takaichi faces multiple challenges—including inflation control, regional tensions, and domestic instability,” ING analysts added.
The Nikkei 225 slipped 0.5% to 49,066.75 points, retreating from Tuesday’s record high of 49,945.5, while the TOPIX index traded slightly higher.
US-China Trade Tensions Linger; India Nears Deal With Washington
Broader sentiment in Asia was dampened by persistent U.S.-China trade tensions. President Donald Trump said he expected his upcoming meeting with President Xi Jinping to produce a “good deal,” though he acknowledged the talks “might not happen.” His remarks reignited concerns over renewed tariff risks and geopolitical frictions between the two superpowers.
In China, the CSI 300 index fell 0.2%, and the Shanghai Composite also edged lower. Hong Kong’s Hang Seng index dropped 0.5%, dragged down by an 0.8% fall in the Hang Seng TECH sub-index.
Elsewhere, the Australian S&P/ASX 200 declined 0.9%, and Singapore’s Straits Times Index was flat. South Korea’s KOSPI gained 0.4%, while India’s Nifty 50 futures rose 0.2% ahead of the market open.
According to The Mint newspaper, India and the United States are nearing a long-awaited trade agreement that could cut U.S. tariffs on Indian exports to around 15–16% from the current 50%, boosting bilateral trade prospects.
Investors remain cautious ahead of the upcoming U.S. CPI report due Friday, which could influence the Federal Reserve’s next interest rate decision.
