A rally in Asian stocks ran out of steam and the dollar stuttered on Tuesday as resurgent worries about U.S. President Donald Trump's trade policies and their impact on the global economy kept risk sentiment in check.

China’s exports surged as shipments to Southeast Asian countries soared, offsetting a sharp drop in outbound goods to the U.S. as prohibitive tariffs kicked in.

Asian markets broke down on Tuesday just as fast as they had rallied on Monday. Traders across the region walked away from early gains after fresh fears over president Donald Trump’s trade decisions began creeping in.

India has replaced Japan as fund managers’ top Asian stock market pick, as the South Asian nation is likely to benefit from supply chain shifts.

Global funds are piling back into Asian stocks as the attraction of soaring currencies and resilient earnings offsets concern that higher US tariffs will sap the region’s economic growth.

A net 42% of fund managers surveyed by Bank of America (BofA) preferred India over other regional markets, placing it ahead of Japan (39%), China (6%), and Singapore (3%).

The Global X Southeast Asia ETF (ASEA) invests in large, liquid equities in Southeast Asia, with a 3.2% dividend yield and $60 million AUM.

US stock futures held steady after a strong trading session on Wall Street, where the S&P 500 erased its losses for 2025.