Equities in Asia and Europe were mixed Tuesday as investors awaited the latest developments in Donald Trump’s trade war.With Wall Street closed for a holiday, there were few major catalysts to drive business, though investors remain on their toes after the US president’s threat of 50 percent tariffs on European Union goods and subsequent delay reviving volatility.But analysts said the uncertainty caused by Trump’s capricious policy announcements, along with his plans to extend tax cuts, was hurting confidence in the US economy and pushing Treasury yields higher.”Markets are once again dancing on hot coals, front-running White House mood swings while dodging macro landmines,” said Stephen Innes at SPI Asset Management.”With yields dangling like anvils and tariff threats swinging like wrecking balls, the only thing certain is that the music won’t stop — until it does. Traders, keep your running shoes on.”Europe bounced on the news of the tariff delay, and European Commission President Ursula von der Leyen’s pledge to move swiftly on a trade deal with the White House.But Asia swung between gains and losses.Tokyo, Hong Kong, Sydney, Singapore and Wellington all rose with London as it reopened after a long weekend, while Frankfurt and Paris also extended Monday’s gains.Shanghai, Seoul, Manila, Mumbai, Jakarta, Bangkok and Taipei were slightly lower. The yen rose against the dollar after BoJ boss Kazuo Ueda said he intended to keep raising borrowing costs if the economy performs as expected.But the Japanese currency reversed course after yields on Japanese bonds sank after reports of a questionnaire from the finance ministry asking market players for their views on debt issuance.The moves come after the sale of 20-year notes saw the worst response in more than 20 years, putting pressure on officials to stabilise the market. Yields on long-term bonds sank after hitting record highs last week.The yen, which hit 142.12 per dollar in early trade, retreated to 143.86 in the afternoon.Still, the dollar remains under pressure against its main peers as investors look nervously at Trump’s trade policy and tax bill, which could add trillions to the US national debt, putting upward pressure on US yields.”In a way, all roads have led to a weaker dollar. Higher perceived US deficits have raised concerns about increased future Treasury issuance, pushing up term premium and seeing people migrate away from the dollar,” said Pepperstone’s Chris Weston.”Concerns of weaker US growth in the second half of 2025 sees dollar sellers. Tariff risk resurfaces, the dollar trades lower and when the tariff risk and the implementation date is subsequently pushed back, again we see the dollar lower.”Traders are also awaiting the release of minutes from the Federal Reserve’s May policy meeting, hoping for an idea about its plans in light of the trade war, while the central bank’s preferred inflation gauge is due at the end of the week.- Key figures at around 0810 GMT -Tokyo – Nikkei 225: UP 0.5 percent at 37,724.11 (close) Hong Kong – Hang Seng Index: UP 0.4 percent at 23,381.99 (close)Shanghai – Composite: DOWN 0.2 percent at 3,340.69 (close)London – FTSE 100: UP 0.9 percent at 8,794.85Dollar/yen: UP at 143.77 yen from 142.81 yen on MondayEuro/dollar: DOWN at $1.1342 from $1.1382Pound/dollar: DOWN at $1.3524 from $1.3563Euro/pound: DOWN at 83.88 pence from 83.91 penceWest Texas Intermediate: DOWN 0.4 percent at $61.29 per barrelBrent North Sea Crude: DOWN 0.3 percent at $64.56 per barrelNew York – Dow: Closed for a holiday

Southeast Asian leaders are looking to insulate their trade-dependent economies from geopolitical uncertainty, in particular US tariffs, as they hold talks with Chinese Premier Li Qiang and Gulf state dignitaries in Kuala Lumpur on Tuesday.US President Donald Trump blew up global trade norms in April when he announced a slew of punishing levies targeting countries around the world, including US allies. Though he subsequently instigated a 90-day pause for most, the experience has spurred the Association of Southeast Asian Nations (ASEAN) to accelerate efforts to diversify its trading networks.”A transition in the geopolitical order is underway,” Malaysian Prime Minister Anwar Ibrahim said Monday.  After a lavish gala dinner the night before, Tuesday sees the inaugural summit between ASEAN, China and the Gulf Cooperation Council (GCC) — a regional bloc made up of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. ASEAN has traditionally served as “a middleman of sorts” between developed economies like the United States, and China, said Chong Ja Ian from the National University of Singapore (NUS).With Washington looking unreliable these days, “ASEAN member states are looking to diversify”, he said.”Facilitating exchanges between the Gulf and People’s Republic of China is one aspect of this diversification.”Malaysia, which holds ASEAN’s rotating chairmanship and opened the bloc’s 46th summit on Monday, is the main force behind the initiative, Chong said. Opening the ASEAN-GCC meeting on Tuesday — China will join later in the day — Anwar said the two blocs had “the means and responsibility to rise as anchors of stability and engines for future growth”.- ‘Timely and calculated’ -Beijing, which has suffered the brunt of Trump’s tariffs, is also looking to shore up its other markets. Its foreign ministry said Monday it “look(ed) forward to strengthening cooperation” with ASEAN and the GCC.China and ASEAN are already each other’s largest trading partners, and Chinese exports to Thailand, Indonesia and Vietnam surged by double digits in April — attributed to a re-routing of US-bound goods.Premier Li’s participation is “both timely and calculated”, Khoo Ying Hooi from the University of Malaya told AFP. “China sees an opportunity here to reinforce its image as a reliable economic partner, especially in the face of Western decoupling efforts.”Beijing and Washington engaged in an escalating flurry of tit-for-tat levies until a meeting in Switzerland saw an agreement to slash them for 90 days. Chinese goods still face higher tariffs than most though. According to a draft statement seen by AFP, ASEAN will express “deep concern… over the imposition of unilateral tariff measures”. But it said earlier this year it would not impose retaliatory duties.- Treacherous waters -ASEAN as a body has historically avoided choosing a side between the United States and China. China is only Southeast Asia’s fourth largest source of foreign direct investment, after the United States, Japan and the European Union, noted NUS’ Chong. Anwar said Monday he had written to request an ASEAN-US summit this year, with his foreign minister saying Washington had not yet responded. Yet any closer alignment with Beijing presents problems of its own, despite Anwar’s insistence Monday night that “whatever is being said… we are here as a friend of China”. On Monday, Philippines leader Ferdinand Marcos said there was an “urgent need” to adopt a legally binding code of conduct in the South China Sea. Beijing has territorial disputes with five ASEAN member states in the area, with China and the Philippines having engaged in months of confrontations in the contested waters.Anwar raised the South China Sea with Li, the Malaysian prime minister said in a Tuesday Facebook post announcing the one-on-one meeting. He also told Li ASEAN “appreciates China’s dedication to regional collaboration”, with most of the topics covered relating to trade. “Other disputants… are perhaps willing to let the Philippines bear the brunt of pressure,” said Chong. Tension between Manila and Beijing “means that these issues will not fade into the background, much as some other Southeast Asian states wish to focus on economic issues”, he added.