AP – Shares tumbled in Europe and Asia and United States (US) futures tumbled yesterday following US President Donald Trump’s announcement of big increases in tariffs on imports of goods from around the world.
The double-digit tariff hikes sent shivers across world markets, as economists warned it raises the risk of recession.
The future for the S&P 500 dropped 3.1 per cent while that for the Dow Jones Industrial Average lost 2.6 per cent, auguring potential losses when US markets reopen yesterday.
Germany’s DAX fell 1.7 per cent to 21,998.48, while the CAC 40 in Paris lost 1.8 per cent to 7,716.66. Britain’s FTSE 100 shed 1.2 per cent to 8,506.44.
In Asian trading, Tokyo’s Nikkei 225 index dipped four per cent briefly, with automakers and banks taking big hits. It closed down 2.8 per cent at 34,735.93.
Mitsubishi UFJ Financial Group’s shares plunged 7.2 per cent as the potential impact of the 24 per cent tariffs on the export-dependent Japanese economy dashed expectations that the central bank will keep raising interest rates. Mizuho Financial Group skidded eight per cent.
Sony Corp.’s stocks sank 4.8 per cent and Toyota Motor Corp gave up 5.2 per cent.
Japan’s yen gained, with the US dollar falling to JPY147.42 from JPY149.28. The euro rose to USD1.0952 from USD1.0855.
In South Korea, which was hit with a 25-per-cent tariff, the benchmark Kospi fell 1.1 per cent to 2,486.70.
Hong Kong’s Hang Seng lost 1.7 per cent to 22,813.22, while the Shanghai Composite index edged 0.2 per cent lower to 3,342.01.
The announcement came as a “major shock”, Yeap Junrong of IG said in a commentary.
“China, in particular, was hit with an additional 34 per cent tariff, bringing its total tariff burden to 64 per cent when accounting for previous measures.” However, losses were partly blunted by expectations of further economic stimulus from Beijing to offset the impact of the higher tariffs.
In Australia, the S&P/ASX 200 fell 0.9 per cent to 7,859.70.
Bangkok’s SET shed 1.1 per cent after Thailand was assigned at 36 per cent tariff on its exports to the US.
That could cause Thai exports to fall by USD7 billion to USD8 billion, or about 2.3 per cent of the total, Kasem Prunratanamala of CGS International said in a report.
