Markets adopted a firmer tone in the Asia session on Tuesday as metals stabilised and equities retraced some of the heavy losses seen a day earlier when declines in gold and silver weighed on sentiment. Tokyo and Seoul led gains in the region with notably sharp rebounds.
Indian stocks rallied after U.S. President Donald Trump announced on Truth Social a deal to reduce tariffs on Indian goods in exchange for India ceasing purchases of Russian oil. While the announcement provided a clear boost to investor confidence, it included few concrete details and offered no timeline for implementation. The news alone was sufficient to push the Indian rupee higher by more than 1% [FRX/][EMRG/FRX].
Currency markets elsewhere also reacted. The Australian dollar rose by over 1% after the Reserve Bank of Australia delivered a 25-basis point interest rate increase. The move made Australia one of the few developed economies, alongside Japan, that have recently raised borrowing costs. The tightening was widely anticipated by markets and was justified by policymakers against a backdrop of inflation running above target and a tight labour market. Traders subsequently increased the odds on a further policy move in May, with the market implying roughly a 75% chance of another hike.
Precious metals were attempting to regain footing after the turmoil that affected markets the previous day. Silver and gold showed signs of stabilising, which in turn supported mining shares, particularly in Australia. Rare earth miners received an additional tailwind from President Trump’s announcement of plans to create a strategic stockpile of critical minerals, supported by $10 billion in seed funding from the U.S. Export-Import Bank. That development helped lift mining equities.
Chinese internet stocks experienced volatility as market speculation about a potential tax increase on gaming weighed on the sector. That uncertainty added to a mixed regional picture despite the broader recovery in equities.
Market participants will be watching several scheduled items that could shape sentiment later in the session and through the week. Key events include the European Central Bank bank lending survey, which may provide insight into credit demand across the euro area, and remarks from Federal Reserve Governor Lisa Cook - correction - the item originally listed as Fed Bowman speaks. In the corporate calendar, U.S. earnings that could influence market direction include results from PayPal, Pfizer and Marathon, with AMD, Amcor and Mondelez reporting after the market close.
Separately, Elon Musk said SpaceX has acquired his artificial-intelligence startup xAI in a deal described as record-setting, a move that brings his AI and space initiatives under a single corporate umbrella.
What to watch next
- ECB bank lending survey - potential signals on European credit demand
- Fed Bowman speaks - remarks that could influence U.S. rate expectations
- U.S. corporate earnings from PayPal, Pfizer, Marathon, and after the close AMD, Amcor and Mondelez