Japanese shares staged a modest rebound on Tuesday after a sharp selloff in the previous session as investors were relieved by U.S. President Donald Trump’s comments that the United States would not imminently impose new tariffs on autos imported from Japan.

The Nikkei share average advanced 1.2% to 20,501.98 in midmorning trade, with Subaru and tyremakers leading the gains. On Monday, benchmark Nikkei lost 2.2% previous to hit the lowest closing level since January 11. The broader Topix rose 1.0% to 1,492.44, with Tokyo’s 33 subindexes gaining.

Asked if he was still considering the U.S. tariffs on Japanese cars, President Trump told a news conference late on Monday that his administration is not looking at that although it’s something he could do at a later date if he wanted to.

On Tuesday, shares of carmakers, tyremakers and car parts makers were boosted by his comments.

Subaru, which has the biggest revenue exposure to the United States among Japanese carmakers, jumped 6.2%, and the transport equipment sector was the best performing sector among the Tokyo Stock Exchange’s 33 sub-indexes, gaining 1.5%.

Source : Reuters