By Ankur Banerjee

SINGAPORE (Reuters) -Asian equities rose on Wednesday lifted by technology shares and the dollar drifted as higher U.S. duties on steel and aluminium took effect, marking the latest chapter in the trade war that has rattled the markets for much of the year.

Investor focus has been on the pace of trade negotiations and the lack of significant progress. Wednesday is the deadline for U.S. trading partners to submit their proposals for deals that might help them avoid Trump's hefty "Liberation Day" tariffs from taking effect in five weeks.

European stock futures pointed to a higher open as the European Central Bank kicks off its two-day policy meeting where it is expected to cut rates on Thursday.

In Asia, South Korea's stocks and its currency surged as liberal presidential candidate Lee Jae-myung's election victory raised hopes of swift economic stimulus, market reforms and easing policy uncertainty.

The benchmark KOSPI jumped more than 2% to its highest since August 2024. That left the MSCI's broadest index of Asia-Pacific shares outside Japan nearly 1% higher.

Japan's Nikkei rose 0.8%, while Taiwan stocks jumped 2% after artificial intelligence behemoth Nvidia boosted U.S. stocks on Tuesday. [.N]

Data showed U.S. job openings increased in April, but layoffs picked up, indicating a slowing labour market as tariffs impact the economic outlook.

Investor attention has been on a possible call between U.S. President Donald Trump and Chinese leader Xi Jinping sometime this week as tensions between the world's top two economies simmer.

Trump on Friday accused China of violating a Geneva agreement to roll back tariffs and trade restrictions. Beijing said it would safeguard its interests and that the accusation was groundless.

Chinese stocks rose on Wednesday with the blue chip index up 0.58%, while Hong Kong's Hang Seng index rose 0.56%.

"Markets may be desensitized to trade headlines, but Trump-Xi talks remain in focus. A grand deal looks unlikely, yet any escalation could still spark a bout of risk aversion," said Charu Chanana, chief investment strategist at Saxo in Singapore.

Meanwhile, Trump signed an executive proclamation putting into effect from Wednesday his surprise announcement last week that he was taking the tariffs on steel and aluminium imports that had been in place since March to 50% from 25%.

"We believe that the steel & aluminium tariffs are an exemplar of other strategic tariffs that are coming and likely to 'stick'," said Thierry Wizman, global FX & rates strategist at Macquarie. "With that, there's still little impetus for a U.S. dollar rally to take hold."