Asian markets mixed after US stocks hit record

Asian stock markets opened the week with mixed performances after US shares closed at an all-time high, recovering from the impacts of President Donald Trump's trade policies.

Market sentiment improved after Canada scrapped its plan to impose a tax on US technology firms, prompting Trump to resume trade talks. US stock futures edged higher following Canadian Prime Minister Mark Carney's announcement that negotiations had restarted.

In Tokyo, the Nikkei 225 rose 0.6% to 40,395.99. Hong Kong's Hang Seng slipped 0.3% to 24,207.36, while the Shanghai Composite index gained 0.5% to 3,438.46.

China reported a slight improvement in factory activity for June after Beijing and Washington agreed in May to delay higher tariffs on each other's exports. However, manufacturing remains in contraction.

South Korea's Kospi advanced 0.5% to 3,070.93, and Australia's S&P/ASX 200 jumped 0.6% to 8,560.80. Taiwan's Taiex declined 1.4%, India's Sensex was down 0.4%, and Thailand's SET index edged up 0.3%.

On Friday, the S&P 500 rose 0.5% to a record 6,173.07, surpassing its previous high from February. The index had fallen nearly 20% between February 19 and April 8.

The Nasdaq composite added 0.5% to 20,273.46, also setting a new record, while the Dow Jones Industrial Average climbed 1% to 43,819.27.

Nearly all sectors in the S&P 500 posted gains, with Nike surging 15.2%, the biggest increase, despite warning of the negative impact of tariffs.

An inflation report released Friday showed prices rose in May, aligning with economists' expectations. Inflation, however, remains a major concern.

Trump's inconsistent tariff policies have complicated financial planning for companies and strained household budgets. Several industries, including automotive and retail, have warned that higher import taxes could hit revenues and profits.

The US maintains a 10% baseline tariff on all imports, along with higher duties on Chinese goods, steel, and autos. A new round of retaliatory tariffs targeting multiple countries is set to expire on July 9.

In an interview with Fox News Channel's "Sunday Morning Futures," Trump said his administration would notify countries that tariffs will be imposed unless agreements are reached. "Letters will start going out 'pretty soon' before the approaching deadline," he said.

The Federal Reserve is closely watching the tariff situation, particularly its effect on inflation. The Fed's preferred inflation gauge, the personal consumption expenditures (PCE) index, rose to 2.3% in May from 2.2% in April, remaining above the central bank's 2% target.

The Fed cut interest rates three times in late 2024 following a historic series of hikes aimed at controlling inflation, which peaked at 7.2% in 2022. The more widely used consumer price index hit 9.1% that year.

The Fed has yet to cut rates in 2025 due to concerns that tariffs could reignite inflation. However, economists still expect at least two rate cuts by year-end.

Bond yields remained stable. The yield on the 10-year Treasury rose to 4.28% from 4.27% late Friday. The two-year yield, which reflects Fed expectations, stood at 3.74%.

In commodities, US benchmark crude slipped 8 cents to $65.44 per barrel, while Brent crude gained 6 cents to $66.86.

The US dollar weakened to 143.93 Japanese yen from 144.46 yen, while the euro rose to $1.1730 from $1.1725.