Japan PM Ishiba responds to Trump’s auto tariffs
Japanese Prime Minister Shigeru Ishiba said that “all options” will be put on the table in response to Washington’s decision to impose a 25% tariff on automobile imports.
“Japan is a country that is making the largest amount of investment to the United States, so we wonder if it makes sense for (Washington) to apply uniform tariffs to all countries,” Ishiba said in parliament.
—Lee Ying Shan, Reuters
Hong Kong shares up more than 1%
Hang Seng Tech ETF
China’s industrial profits drop 0.3% at start of the year as tariff risks loom
China’s industrial profits fell 0.3% from a year ago in the first two months of 2025, official data showed Thursday, as the economy faces heightened global trade tensions.
Profits at industrial firms have declined for three consecutive years, reinforcing calls for policymakers to step up support for the faltering economy.
U.S. President Donald Trump has imposed 20% additional tariffs on Chinese goods in just a little over two months in office. He announced on Wednesday night stateside auto tariffs of 25% on cars “not made in the U.S.,” starting April 2.
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—Anniek Bao
Shares of Asia’s automakers fall as Trump announces 25% tariffs on car imports
Shares of Asia’s automakers fell after U.S. President Donald Trump announced he will impose tariffs on cars not made in the country.
Japanese automakers Toyota and Honda fell 3.69% and 2.91% respectively. Nissan, which has two plants in Mexico, declined 2.92%, and Mazda Motor lost over 6%. Mitsubishi Motor fell 4.9%.
South Korea’s Kia Motors, which has a manufacturing plant in Mexico, dipped 2.76%. Shares of Chinese automakers Nio and Xpeng fell 3.94% and 1.97% respectively.
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—Lee Ying Shan
The direction of average tariff rates is up, Barclays says
Whether President Trump will indeed soften his approach to tariffs as he has recently suggested is uncertain, but one thing that is clear is that average tariff rates are rising, according to Barclays.
“We think the direction of travel is clear: average tariff rates are increasing, likely to levels not seen since before World War II,” the firm’s Michael McLean wrote Wednesday.
“At the end of 2024, the US weighted average tariff rate was 2.5%. After the tariffs that Trump has implemented so far, the average tariff rate has increased more than 3 times to over 8%,” he continued. “We assume once Trump is finished, it could be as high as 15%.”
— Sarah Min
UBS highlights 3 reasons to favor U.S. AI companies over China’s
In a recent note, UBS shared three compelling reasons why investors should favor U.S. artificial intelligence firms over those of China’s.
“A lingering sense of nervousness remains among AI investors, primarily centered on the concern that Chinese AI developers and their low-cost models threaten to usurp US competitors with higher sunk investment costs,” wrote Mark Haefele, chief investment officer of UBS Global Wealth Management. “While both the United States and China have made significant strides in the AI sector, CIO believes there are compelling reasons to favor US AI companies over their Chinese counterparts, especially in the near term.”
Haefele said outsized capital expenditures from U.S. firms should drive greater competitive advantage.
“The higher capex intensity in the US, defined as capex spending divided by revenues, stands at 20% in 2025 compared to China’s 11.7%. This disparity highlights the US’s commitment to maintaining a technological edge, even though it may lead to higher depreciation-related expenses in the short term,” he wrote.
Meanwhile, higher research and development spending from U.S. AI firms means they are better positioned to discover “the next big thing.” Finally, Haefele underscored that U.S. firms have a “clear advantage” in higher monetization potential, suggesting that they have a better chance of generating revenues and profits.
— Lisa Kailai Han
