Hong Kong's Hang Seng index drops more than 2% as investors assess Trump tariff threats

Private equity firm KKR on Tuesday said it would acquire 100% of Japanese software developer Fuji Soft. KKR already owns 58% of the company after its last tender offer.

The investment firm said it had signed a memorandum of understanding with Fuji Soft on Monday to take its full ownership.

KKR had been in a bidding war with Bain Capital to take the Japanese firm private.

Fuji Soft shares were trading marginally higher, up 0.20%.

— Vinay Dwivedi

Japan's 5-year government bond yield rose to 1.165%, the highest level since October 2008, according to LSEG data.

Yield on the 10-year government bond gained more than 3 basis points to 1.575%, hovering near the highest levels since late 2008, while yield on the 30-year government bond was little moved at 2.601%.

Bank of Japan Governor Kazuo Ueda has taken in stride the recent rises in bond yields and reiterated on Monday the central bank would continue to hike interest rates if inflation stays on track to hit its target band, despite potential losses on the government bond holdings.

"We have said that we will continue adjusting the degree of monetary easing if underlying inflation is likely to approach 2%," he said.

— Anniek Bao

India's benchmark Nifty 50 gained 0.47% in early trade on Tuesday. If the gains hold, it will be the seventh consecutive session for the index in positive territory.

The index is up 0.24% so far this year.

— Amala Balakrishner

The Indonesian rupiah depreciated 0.45% against the U.S. dollar to 16,625 at 11.36 a.m. Singapore time on Tuesday, after falling to its lowest level since June 1998.

This comes after Bank Indonesia held the 7-day reverse repurchase rate at 5.75% in its meeting last week.

Other emerging market currencies were similarly down.

The Thai baht had weakened 0.41% against the the dollar to 33.98, while the Malaysian ringgit was down 0.16% against the dollar to 4.4370.

Elsewhere in Asia, the Korean won was down 0.17% to 1,469.65 against the dollar while the Chinese yuan lost 0.11% against the dollar to 7.2613.

— Amala Balakrishner

Hong Kong's Hang Seng Index traded more than 2% lower on Tuesday.

The Hang Seng Tech Index was down 2.15% as of 11 a.m. local time. The worst performers include BYD Electronic, which plunged 9.80%, Sunny Optical Technology Group which lost 7.36% and Xiaomi Corp which was down 6.32%.

Several major Chinese companies are listed on the index, which is up 16.35% since the start of the year.

The Hang Seng Tech index was down 3.23%.

The Hang Seng Tech Index ETF shows the day's moves:

— Amala Balakrishner

Shares of BYD fell as much as 3.22% in early trade on Tuesday, on the back of a 73.1% surge in its net profit for the fourth-quarter to a record 15 billion yuan ($2.1 billion).

The Chinese electric vehicle giant's fourth-quarter revenue rose 52.7% at 274.9 billion yuan, according to Reuters' reports.

Its fiscal year 2024 revenue increased 29% to 777 billion yuan ($107.12 billion) - surpassing Tesla's $97.7 billion revenue in FY2024. 

— Amala Balakrishner

Shares of Chinese tech giant Xiaomi fell as much as 5.61% on Tuesday following its upsized $5.5 billion share sale to ramp up its electric vehicle manufacturing plans.

The company sold 800 million shares at 53.25 Hong Kong dollars ($6.85) each, the company said in a regulatory filing.

— Amala Balakrishner

The Bank of Japan will continue to raise interest rates if the country's economy and inflation continues to develop "in line with its outlook", minutes from the central bank showed.

In its minutes, one of the BOJ's board members pointed out that real interest rates were expected to remain significantly negative after the policy interest rate hike, and the Bank should to continue to raise rates so that the negative real interest rates would shrink.

Other members also noted concerns over inflation, saying that risks to prices had become more skewed to the upside.

The BOJ's forecast in January showed that the bank is expecting core inflation to come in at 2.4%, while GDP growth is expected to be at 1.1%.

— Lim Hui Jie

Japan's Topix index opened higher on Tuesday, and briefly hit 2,818.36 — its highest level in eight months.

As at 9.35 a.m. local time, the broad-based index had gained 0.78%.

Gains were led by inkjet printer manufacturer Mimaki Engineering which advanced 9.11%, beverage firm Yomeishu Seizo which rose 5.67% and electrical equipment manufacturer Fujikura which was up 4.97%.

— Amala Balakrishner

Shares in South Korea's Hyundai Motor rose 5.16% in early trade Tuesday, after it invested $21 billion in the United States on Monday state side.

The amount invested includes a new $5.8 billion plant for Hyundai Steel in the state of Louisiana, which will create over 1,400 jobs and produce over 2.7 million metric tons of steel annually.

The plant is also expected to supply steel to auto plants in Alabama and Georgia.

Shares in Hyundai Steel was up 1.19% as at 9.19 a.m. local time.

— Amala Balakrishner

President Trump said the U.S. will impose 25% tariffs on countries that buy oil and gas from Venezuela, as he seeks to increase pressure on President Nicolas Maduro and China.

Countries that buy oil and gas from Venezuela will face tariffs on any trade they have with the U.S., Trump said in a post on his social media platform Truth Social. The tariffs take effect April 2, the president said.

Venezuela exported about 660,000 barrels per day in 2024, according to data from Kpler. China was the largest destination for the South American nation's crude exports, purchasing 270,000 barrels per day last year.

"This announcement by the Trump administration appears to be one more action targeting China," Matt Smith, an oil analyst at Kpler, told CNBC.

Brent crude futures rose 61 cents, or 0.85%, to $72.77 a barrel by 1:15 p.m. ET. U.S. West Texas Intermediate crude was up 59 cents, or 0.86%, at $68.87.

— Spencer Kimball