STI draws relief from hopes of tariff exemptions

STOCK markets in Asia recovered ground on Thursday, drawing relief from positive US job market data and hopes that US President Donald Trump's protectionistic tariffs may exempt key allies.

Investors struggled to get a read on the US President, who shifted his tariff threats away from Europe and to China. In his latest tweet, President Trump said China has been asked to develop a plan to cut its trade deficit with the US by US$1 billion. The tweet amused many economists who noted that US$1 billion represents a mere 0.27 per cent of the record US$375.2 billion goods trade surplus China had with the US last year. But China was not tickled. Its foreign minister Wang Yi warned that a trade war would only harm all sides.

Lombard Odier Investment Managers believe that the uncertainty around US trade policy is likely to remain for some time before clarity emerges.