Honda Motor Co. shares surged nearly 5% on Thursday to reach a two-year peak of ¥1,748, as investors bet on easing trade tensions that could benefit the company’s North American operations.
The gains followed reports that the U.S. is considering reducing tariffs on Canadian steel, aluminum, and automobiles, a move that would ease cost pressures for Japanese automakers with manufacturing facilities in Canada. Toyota Motor Corp. also climbed 3.6% to ¥3,046, recovering from a two-day decline, as both companies stand to gain from potential tariff reductions on vehicles imported from Canada to the U.S.
The rally contributed to a 0.8% rise in the Nikkei 225 index, with the broader market sentiment buoyed by the prospect of softer trade barriers. Late on Wednesday, President Donald Trump announced a delay to a planned 50% tariff against Canada, further easing concerns over escalating trade restrictions that could disrupt auto supply chains.
Analysts attributed the uptick in Honda’s stock to improving conditions in its key North American market, where the company has significant production and sales operations. The automaker’s shares have now recovered ground after a period of volatility, reflecting growing optimism over trade policy adjustments that could support profitability in the region.
