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Global markets fell on Monday over fears of an intensified global trade war ahead of Donald Trump’s expected unveiling of a swath of extra tariffs.
Japanese, South Korean and Hong Kong stocks fell sharply, accelerating a sell-off that began last week, after US President Donald Trump said the reciprocal tariffs he is expected to announce on April 2 would apply globally.
“You’d start with all countries,” Trump told reporters on board Air Force One. “We’ll see what happens.” He said “every single country in Asia” engaged in “unfair” trade practices towards the US.
Japan’s benchmark Topix dropped 3.2 per cent and the exporter-oriented Nikkei 225 slid 3.9 per cent. In South Korea the Kospi fell 2.2 per cent. Hong Kong’s Hang Seng dipped 0.4 per cent.
Gold hit a record $3,098 per troy ounce while US Treasury yields declined, in a sign that investors were piling into safe assets.
“Many investors are [waiting] for actual tariffs to be announced, unwinding their positions and realising gains,” said Wei Li, head of multi-asset strategy for China at BNP Paribas Asset Management. “This tariff announcement . . . has affected the whole market sentiment.”
Trump has billed April 2 as a ‘liberation day” for the US economy but his plans to levy so-called reciprocal tariffs on countries that he judges have unfair trade relationships with the US have alarmed investors.
In currency markets, the yen strengthened 0.4 per cent against the dollar to ¥149.30 while the Korean won was flat. The US dollar edged down 0.2 per cent against a basket of key trading partners.
The slides in Asia come after falls on Friday in the US, where the S&P 500 dropped 2 per cent. The tech-focused Nasdaq Composite slid 2.7 per cent as deteriorating economic data raised fears about stagflation.
