Hyundai and Kia surge after Washington confirms retroactive tariff cuts, lifting Asia markets despite crypto-driven volatility and rising bond yields in Japan.
MARKET INSIDER – South Korean automakers led Asian equities higher on Tuesday after U.S. Commerce Secretary Howard Lutnick confirmed that America’s auto tariffs on South Korea would be reduced to 15%, effective retroactively from November 1. The announcement—shared via the U.S. Department of Commerce on X—also included the removal of tariffs on aircraft parts and an adjustment to put Korea’s reciprocal rate on par with Japan and the EU.
The policy shift sparked an immediate rally. Hyundai Motor jumped nearly 5%, while Kia rose about 3%, helping lift the Kospi by 1.02%, even as the smaller Kosdaq slipped 0.13%. The move comes at a pivotal moment for South Korea’s economy: November headline inflation rose 2.4% year over year, slightly above expectations, while core inflation held steady at 2%. The data reinforces expectations that the Bank of Korea will extend its current rate hold at 2.5%, which entered its fourth straight meeting last week.
The broader Asia-Pacific region traded mostly higher despite a global risk-off tone sparked by another sharp downturn in crypto markets. Bitcoin fell 6% overnight, dipping below $86,000 after repeatedly failing to reclaim $90,000 since late November. Crypto-linked U.S. stocks such as Coinbase and MicroStrategy also slid, adding pressure to Wall Street. In tech, AI-related names including Broadcom and Super Micro Computer posted notable losses as profit-taking hit the sector.
Japan’s markets showed resilience. The Nikkei 225 gained 0.54% and the Topix climbed 0.44%, led by financials, energy, and materials. Industrial robotics giant Fanuc surged nearly 6%, while NGK Insulators and Fujikura also advanced. Yet under the surface, Japan’s bond market flashed a warning: 10-year JGB yields rose to 1.88%, the highest since 2008, amid speculation the Bank of Japan could hike rates as early as this month. Longer-term yields hit multi-decade or all-time highs, with the 30-year JGB reaching 3.411%.
Elsewhere, Australia’s ASX 200 edged up 0.12%. Hong Kong’s Hang Seng Index gained 0.49% at the open, while China’s CSI 300 slipped 0.17%. Alibaba climbed nearly 3%, extending a three-day rally after unveiling new Quark AI-powered glasses in late November.
U.S. futures were little changed in early Asian trading after all three major indices ended their five-day winning streaks. The S&P 500 fell 0.53%, the Nasdaq dipped 0.38%, and the Dow pulled back 0.9%.
With tariff relief boosting South Korea’s auto giants and Japan’s bond market signaling a potential policy shift, investors across Asia now face a crosscurrent of catalysts—ranging from AI volatility to crypto shakeouts and looming central-bank decisions—setting the stage for a complex start to December.
