- Stock markets are extending a brutal selloff as Trump’s trade tariffs spark investor fears.
- Asian markets are suffering due to concerns over tariffs hitting earnings and economies.
- Commodities are falling amid recession fears while the Japanese yen has risen as a haven currency.
A brutal stock market selloff intensified on Monday as investor fears over the fallout from US President Donald Trump’s sweeping new trade tariffs set in.
Asia’s stock markets opened the week deep in the red as investors fret over the impact of Trump’s tariffs on company earnings and economies.
The MSCI Asia Pacific Index slumped the most since the 2008 Global Financial Crisis, according to Bloomberg’s analysis. And investors in US futures were pessimistic on Sunday night.
“The impact spans economies, financial markets, supply chains, and geopolitics and will force governments, businesses, and households to retune their approach to trade relations, capital expenditure, and consumption,” wrote Eunice Tan, an S&P Global Rating credit analyst, on Monday.
Asia markets saw major losses across countries, including in China and Hong Kong, which were closed on Friday’s holiday. Shares in chip hub Taiwan — which was hit with a 32% tariff rate — tanked nearly 10% in its biggest decline on record in the first day of trading since the tariffs were announce.
- Japan’s Nikkei 225: -7% at 2:50 p.m. local time
- South Korea’s Kospi: -5.2% at 2:46 p.m. local time
- Hong Kong’s Hang Seng Index: -12.6% at 2:06 p.m. local time
- China’s CSI300: -7.7% at 2:05 p.m. local time
- Taiwan TAIEX: -9.7% at 11:09 a.m. local time
- Australia’s ASX 200: -4.2% at 4:07 p.m. local time
US and Europe stock futures were also sharply lower:
- S&P 500 futures: -3.6% at 4,926.50 at 1:58 a.m. ET
- Dow Jones futures: -2.9% (down 1,120) at 37,410
- Nasdaq 100 futures: -4.4% at 16,764.75
- Euro Stoxx 50 futures: -3.1% at 1:54 a.m. ET
Commodities similarly traded lower over concerns over a recession. The Japanese yen, seen as a haven currency, is up. Key indicators include:
Markets were already shaken after Trump unveiled higher-than-expected tariffs on Wednesday. Sentiment worsened on Friday after Beijing retaliated against Trump’s new tariffs. China said it would start charging a 34% tariff on all US imports on Thursday.
“Barring a phone call between Trump and Xi to suspend tariffs, chances are that things will probably get worse before it gets better. Markets ought to brace for more tensions even if (longer-term) hope lingers,” wrote Vishnu Varathan, Mizuho’s head of macro research for Asia excluding Japan, in a Monday note.
“In the meantime, needless devastation by way of collateral damage all around will be hard to avert as aggregate demand slumps accentuated by a sharp drop in demand for capital goods as uncertainty paralyzes investments,” Varathan added.
Trump said on Sunday night that he doesn’t want the stock market to crash. He said the new tariffs are necessary to rectify America’s trade deficits with other countries.
“I don’t want anything to go down, but sometimes you have to take medicine to fix something,” Trump told reporters.
This is a developing story. Please check back for updates.
