Asian stock markets have recently experienced significant declines, with major indices in Japan, Hong Kong, and South Korea dropping over 2%. This downturn is largely attributed to a broad retreat on Wall Street, following the announcement of new tariffs on imports.
Market Reactions in Asia
The Nikkei 225 index in Tokyo fell by 2.9%, closing at 37,155.50. Technology stocks were particularly hard hit, with notable declines in key companies:
- Advantest, a computer chip test equipment maker, plummeted by 8.8%.
- Disco Corp. saw a decline of 10.3%.
- Tokyo Electron experienced a drop of 4.5%.
In Hong Kong, the Hang Seng index dropped 3.4% to 22,905.52, while the Shanghai Composite index lost 2% to 3,320.90. South Korea’s Kospi index also suffered, giving up 3.4% to settle at 2,532.78. The Australian market was not spared either, with the S&P/ASX 200 shedding 1.2% to 8,172.40.
U.S. Market Pressures
The U.S. stock market has also been under pressure, with the S&P 500 declining 1.6% to 5,861.57. The Dow Jones Industrial Average dropped 0.4% to 43,239.50, while the Nasdaq composite faced a significant tumble, down 2.8% to 18,544.42. This marks a troubling trend, as the S&P 500 has now fallen in five of the last six trading sessions after reaching an all-time high just a week prior.
Concerns regarding the U.S. economic outlook are mounting, particularly as tariffs threaten to exacerbate inflation. There are fears of increased unemployment due to potential mass layoffs of government workers. Nvidia, a key player in the tech sector, saw its stock price drop by 8.5% despite initially rising after a better-than-expected profit report.
International Trade Concerns
China’s Commerce Ministry has condemned the tariff increases, asserting that they violate international trade rules. The ministry’s statement highlights concerns that these measures could destabilize the global industrial chain, further complicating an already tense trade environment.
As the U.S. government maintains its stance on tariffs, the potential for retaliatory measures from China looms large. This raises fears of an escalating trade war, which could have far-reaching implications for global economic stability.
Commodities and Currency Markets
In the commodities market, U.S. benchmark crude oil prices fell by 61 cents to $69.74 per barrel in electronic trading. Meanwhile, Brent crude, the international standard, decreased by 57 cents to $73.00 per barrel. These declines in oil prices reflect broader market anxieties and the potential impact of tariffs on global demand.
Currency markets also reacted to the unfolding situation, with the U.S. dollar rising to 150.03 Japanese yen from 149.82 yen late Thursday. Conversely, the euro slipped to $1.0390 from $1.0401, indicating a shift in investor sentiment as they navigate the uncertainties surrounding trade policies and their economic ramifications.
📎 Related coverage from: go.com
