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Treasury Secretary Bessent to lead trade negotiations with

Japan

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Japan's Nikkei surges 5.6%, JGB yields rise from 3-month

lows

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Hong Kong equities gain despite Trump's hard line on

Beijing

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Sell-off continues in Taiwan,

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Crude oil rebounds from nearly four-year lows

By Kevin Buckland

TOKYO, April 8 (Reuters) - Asian stocks bounced off more

than one-year lows and U.S. stock futures pointed up on Tuesday,

but many investors remained on edge even as they hoped

Washington might be willing to negotiate some of the aggressive

tariffs that have unleashed turmoil in markets.

A 5.6% rebound in Japan's Nikkei far outpaced other

regional markets, with Treasury Secretary Scott Bessent tasked

with leading trade negotiations with Tokyo.

"Importantly, a little ray of sunshine is starting to emerge

that gives hope that the U.S. is genuinely open to trade

negotiations, (with) the most significant being Japan with

Treasury Secretary Bessent," said Tapas Strickland, head of

market economics at National Australia Bank.

Strickland, however, noted volatility remains extremely

elevated, with the "rare event" of the VIX index spiking

above 60 overnight for only the second time since the pandemic.

Indeed, the uptick in Tokyo comes after a steep selloff in

recent days, while China's markets rose only modestly after the

country's sovereign wealth funds stepped in to buy shares.

Chip-export-dependent Taiwan's benchmark tumbled 5%, a

day after suffering its worst fall on record.

MSCI's broadest index of Asia-Pacific shares

added 1.7% to climb from its lowest level since February of

2024, but that followed a more than 10% dive over the previous

two sessions, and much of the rebound came from Japanese shares.

Thai stocks dropped nearly 6% in catch-up selling

from a holiday on Monday, while Indonesia returned from

a week-long holiday to 9% losses.

Hong Kong's Hang Seng climbed 1.6% after its steepest

drop since the 1997 Asian financial crisis on Monday. Mainland

Chinese blue chips added 1%, with help from buying by

sovereign fund Central Huijin Investment and other state-backed

investors.

The Chinese yuan fell to 7.3677 per dollar in the

offshore market, the weakest in two months, before rebounding to

be slightly stronger than Monday's close at 7.3393.

The heightened uncertainty in markets wasn't helped by

shifting headlines on trade as investors looked for respite from

the sharp market volatility.

An erroneous report by CNBC that President Donald Trump was

considering a 90-day pause on tariffs for countries other than

China was quickly denied by the White House.

Trump also dug in his heels over China, vowing additional

50% levies if Beijing does not withdraw retaliatory tariffs on

the United States. Beijing said on Tuesday it will never accept

the "blackmail nature" of U.S. tariff threats.

BEAR RALLY?

U.S. business leaders have begun speaking out about the

damage to the economy and financial markets that could be

wrought by Trump's global trade war, with JPMorgan Chase ( JPM )

CEO Jamie Dimon warning on Monday of inflation and a U.S.

slowdown.

The risk-sensitive Australian dollar leapt 0.9%, and the

Canadian dollar gained 0.6% against its U.S. counterpart.

Australia's equity benchmark gained 1.7%, and South

Korea's KOSPI added 0.5% after paring an earlier advance

of as much as 2.3%.

Pan-European STOXX 50 futures rallied 2.2%.

U.S. S&P 500 futures rose 1.4%, after the cash index

ended a wild session with a small decline on Monday.

"The signs are there that if the market hears what it wants

to hear then risky assets could explode higher," said Chris

Weston, head of research at Pepperstone.

"However, the net effect of the news on the day was hardly

positive, and the headlines that the market really wanted to

believe to be true proved to be false," he said.

"I'd argue what played out was more in fitting with a bear

market rally and one that traders should look to fade, rather

than believing we've reached a key inflection point for a

sustained trend higher."

The 10-year Treasury yield rose as much as 6

basis points (bps) to 4.216% on Tuesday, after jumping some 17

bps on Monday as it bounced from six-month lows.

That helped wrench Japanese government bond yields off their

own multi-month lows, with the 10-year yield up

as much as 13 bps to 1.24%.

The U.S. dollar slipped 0.5% against a basket of six major

peers, but that followed a two-day 1.2% advance from a

six-month trough.

The dollar eased 0.2% to 147.53 yen.

The euro jumped 0.7% to $1.0979, and sterling

climbed 0.5% to $1.2789.

The European Commission said on Monday it had offered a

"zero-for-zero" tariff deal to avert a trade war with the United

States as EU ministers agreed to prioritise negotiations, while

also striking back with 25% tariffs on some U.S. imports.

Gold added 0.4% to $2,995 per ounce, although it was

still well back from last Thursday's record peak at $3,167.57,

reached in the immediate aftermath of Trump's "Liberation Day"

tariff announcement.

Brent crude futures were up 1.5% at $65.16 per

barrel, and U.S. West Texas Intermediate crude futures

rose 1.6% to $61.66.

Cryptocurrency bitcoin rose 1.2% to trade just below

$80,000, after bouncing off a five-month low of $74,445.79

reached on Monday.