Global markets plummeted on Monday, deepening the collapse of actions triggered by US President Donald Trump’s trade war and China’s response to tariffs.
Germany DAX fell by 9%, while London’s FTSE was about 5% lower. European markets were generally better than the Asian markets at the beginning of the trading session.
Japan’s Nikkei 225 reference index closed 7.9% lower, while Topix fell by 7.7%. The Sony technology giant plummeted more than 10%.
In Hong Kong, where financial markets reopened after a holiday, the Hang Seng reference rate has closed more than 13% lower on its worst negotiation day since 1997, according to the rate of the index of the highest historical daily losses.
In mainland China, Shanghai Composite Index closed 7.3% lower. The Blue-Chip CSI300 index also lost about 7%.
“Washington’s shocking decision to impose a 34% tariff on Chinese products was a direct blow to the main export sectors, such as semiconductors and EVs (electric vehicles), triggering a marked and wide repracification in Asian markets.”
Dilin Wu, Peppersstone research strategist
Hong Kong trading volumes increased on Monday, which WU said it was “a clear sign of widespread forced liquidations and what can only be described as a total panic.”
The worst two -day period for Wall Street actions in five years. US futures plummeted on Sunday night (6) after two settlement sessions that lost more than $ 5.4 trillion in market value.
US actions fell sharply on Friday (4), after retaliating a 34% tariff on all US products, increasing trade war tensions among the two largest economies in the world.
A comment published on Sunday by People’s Daily, the official Chinese Communist Party spokesman, emphasized that the country has a “strong ability to support pressure” in the face of “US tariff intimidation.”
“Given the reckless tariff blows of the US, we know exactly what we are dealing with and we have many contracted in hand. After eight years of trade war with the US, we accumulated a wealth of experience in this fight,” he said.
China’s retaliation last week against the US was larger than its previous actions and triggered a widespread turbulence in the global market.
Taiex from Taiwan closed 9.7% on Monday. Almost all Taiwanese actions, including TSMC and Foxconn, two of the island’s best -known exporting powers, triggered circuit breakers, according to the Taiwan Central News Agency.
Both TSMC and Foxconn fell about 10%.
Oil prices continued to fall on Monday after last week’s losses. Brent’s futures, the global reference, fell more than 2.4%, while the future of the US intermediate West Texas intermediate, the US reference, fell 2.5%.
In Australia, the ASX 200 reference index closed with a drop of 4.2%, while the New Zealand NZX 50, the first rates to close in the region on Monday, ended the day with a drop of 3.7%.
South Korea’s Kospi finished 5.6% below. The technological power of the country and the main boost of growth, Samsung, fell more than 5%.
Even the gold is being sold. Traditionally considered a safer financial bet, gold fell more than 4% to about $ 3,000 the jaguar since Thursday (3).
Trump ignores concerns
US shares are expected to open in a strong drop on Monday, placing the S&P 500 on the edge of a low market, a 20% decline compared to peak and a signal for investors and perhaps for the general economy.
Bill Ackman, a billionaire CEO of the Investment Company Pershing Square, said Trump is “losing the confidence of business leaders around the world” and begged him to ask for time on Monday to avoid an “economic nuclear war”.
“By imposing massive and disproportionate tariffs on our friends and enemies and thus launching a global economic war against the world at once, we are in the process of destroying trust in our country as a commercial partner, as a place to do business and as a market to invest capital.”
Bill Ackman, CEO of the Investment Company Pershing Square
On Sunday night (6), aboard the Air Force One that he did not overthrow markets intentionally, but refused to predict how actions would be negotiated in the future, which increased investor concerns.
“What will happen to the market? I can’t tell you,” Trump said. “But I can tell you, our country has become much stronger and eventually it will be a country like no other.”
Donald Trump
The US president, who has long considered himself a negotiator, exposed what would be necessary to reach an agreement with China about tariffs.
“I’m willing to negotiate with China, but they need to solve their surplus,” he said.
“We have a tremendous deficit problem with China,” he added
Last year, the US imported US $ 438.9 billion in China’s goods and exported US $ 143.5 billion to the country, according to the United States Commercial Representative’s office.
The president also said he wants to resolve the deficit with the European Union and, if they are open to it, it is open to discussion. Trump said he received requests from technology executive rates and world leaders over the weekend.
Japanese Prime Minister Shigero Ishiba said in Parliament on Monday (31) that he would continue to appeal to the US to reduce tariffs. On Wednesday (2), Trump imposed a general tariff of 24% on Japan, an ally of the defense treaty, which is expected to take effect later this week.
Ishiba said he intended to visit the US “as soon as possible” and wanted to convey the idea that Japan “is not doing anything unfair.”
In Taiwan, President Lai Clay-Te said Taipei will negotiate with Washington to eliminate tariffs on both sides and actively solve their non-tariff trade barriers.
He added that Taiwan will buy more US products to reduce the commercial deficit, and the island’s Ministry of Defense has presented a military purchasing list.
“We want to make it clear to the US how much Taiwan contributes to their economy,” Lai said.
Barclays economists said on Monday that they have a “cautious vision” about the ability of Asian governments such as South Korea and Singapore to successfully negotiate with the US to reduce tariffs and started the process of reducing economic growth forecasts for the region.
