Asian stock markets showed a mixed performance on Tuesday following a steep decline in U.S. stocks. The market downturn came as U.S. President Donald Trump imposed new tariffs, prompting China to retaliate with higher duties on American farm exports.
U.S. stock futures remained stable while oil prices continued their downward trend.
Tariffs and Retaliation
As of early Tuesday, a 25% tariff on imports from Canada and Mexico went into effect. Additionally, Trump raised tariffs on Chinese goods by 10%, bringing the total to 20%. In response, Beijing introduced retaliatory tariffs of up to 15% on various U.S. agricultural products, including soybeans, beef, and corn.
Stock Market Performance in Asia
- Japan: The Nikkei 225 fell 1.2% to 37,331.18.
- Hong Kong: The Hang Seng Index dropped 0.4% to 22,922.16.
- China: The Shanghai Composite Index edged up 0.2% to 3,324.21.
- South Korea: The Kospi slipped 0.1% to 2,528.92.
- Taiwan: The Taiex fell 0.7%.
- Thailand: The SET Index declined 0.1%.
U.S. Market Decline
On Monday, the S&P 500 fell 1.8% after Trump stated there was “no room left” for negotiations to reduce tariffs. The Dow Jones Industrial Average dropped 1.5%, while the Nasdaq Composite slumped 2.6%.
Francis Lun, CEO of Geo Securities in Hong Kong, commented on China’s response:
“I don’t think China will buy any more U.S. farm products. The orders will go to South America. All in all, it’s a lose-lose situation. Nobody gains anything.”
Investor Concerns Over Trade War Impact
Investor sentiment has shifted due to concerns over the escalating trade war. Hopes that Trump would ease trade tensions have faded, and the recent losses have reduced the S&P 500’s gains since Election Day to just over 1%, down from a peak of over 6%.
Economic Indicators and Market Trends
- U.S. Manufacturing Data: A new report showed that U.S. manufacturing activity is still expanding but at a slower pace than expected. More concerning, new orders have declined, and prices have risen as companies debate who will bear the burden of increased tariffs.
- Market Reactions: Technology stocks suffered significantly, with Nvidia plummeting 8.8% and Tesla falling 2.8%.
- Corporate Developments: Kroger’s stock fell 3% after CEO Rodney McMullen resigned following an internal investigation into his personal conduct.
Cryptocurrency Market Performance
The cryptocurrency sector was also affected by Wall Street’s downturn. Bitcoin initially saw gains after Trump’s administration announced a strategic reserve for crypto assets. However, MicroStrategy, a company investing heavily in Bitcoin, lost 1.8%, while Coinbase, a major crypto trading platform, dropped 4.6%.
European Markets and Inflation Reports
European stocks surged following reports of lower inflation in February. This development raised expectations of an interest rate cut by the European Central Bank later this week.
- Germany’s DAX: Up 2.6%
- France’s CAC 40: Gained 1.1%
Despite Trump’s “America First” policies, international markets have outperformed the U.S. stock market in 2024.
Commodities and Currency Markets
- Oil Prices: U.S. benchmark crude fell by 55 cents to $67.82 per barrel, while Brent crude dropped 73 cents to $70.89 per barrel.
- Currency Exchange: The U.S. dollar declined against the Japanese yen, trading at 149.18 yen per dollar. The euro inched up to $1.0489.
- Bitcoin: The cryptocurrency fell 8.9% to around $83,300, according to CoinDesk.
The global financial landscape remains volatile as the trade war between the U.S., China, and Canada escalates. Investors are keeping a close watch on further developments, particularly as negotiations stall. Market trends indicate that businesses and consumers alike are feeling the impact of rising tariffs, with uncertainty likely to persist in the near future.
For more news and updates on global financial trends, visit Daljoog News.
