Tokyo: Asia shares mostly fell in Monday trading as worries grow about President Donald Trump imposing tariffs on key US trading partners. Japan's benchmark Nikkei 225 lost 2.4 per cent in early trading to 38,612.96. Australia's S&P/ASX 200 declined 1.8 per cent to 8,376.30. South Korea's Kospi dropped 2.9 per cent to 2,443.57. Hong Kong's Hang Seng dipped 1.4 per cent to 19,942.54, while the Shanghai Composite was lower but changed slightly to 3,250.60. Analysts said Asian markets braced for volatility by a possible trade war escalation. “The implications for trade restrictions could result in reduced global trade flows, supply chain shifts, which could mean higher costs for businesses, and higher inflation,” said Yeap Jun Rong, market strategist at IG.
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Asian markets fall, Trump tariffs spark concerns.
Wall Street ended last week lower, with the S&P 500 falling 0.5 per cent. The Nasdaq composite dropped 0.3 per cent. The indexes posted their first weekly loss in three weeks. The Dow Jones Industrial Average fell 0.8 per cent. The selling in New York was broad, with about 75 per cent of the stocks in the S&P 500 closing lower. Technology and energy companies accounted for a large share of the decline. Investors have been jolted by a report from a Chinese upstart, DeepSeek, about developing a cheaper large language model that can compete globally. The disruption raised questions about whether all the investment expected for AI chips is needed, sending some technology shares tumbling.
Trump’s Tariffs on Canada, Mexico, and China Set to Take Effect Amid Economic Reactions
Trump's 25 per cent tariffs on most imports from Canada and Mexico and 10 per cent tariffs on goods from China are to take effect Tuesday. His administration has not said what specific improvements would need to be seen in stopping illegal immigration and the smuggling of fentanyl to merit the removal of the tariffs. Canada and Mexico ordered retaliatory tariffs on American goods. Canada's will take effect Tuesday on a range of products, while Canada didn't give immediate details. Tariff worries helped push long-term bond yields higher, including the 10-year Treasury, which rose to 4.54 per cent Friday from 4.52 per cent late Thursday. Yields have been generally climbing since September as the U.S. economy has remained much more solid than economists expected.
Also, last week, the US Federal Reserve left its benchmark interest rate unchanged, taking a more cautious view on how policies under Trump might impact inflation and the broader economy. In energy trading, benchmark US crude jumped $1.10 to $73.63 a barrel. Brent crude, the international standard, gained 40 cents to $76.07 a barrel. In currency trading, the U.S. dollar edged up to 155.55 Japanese yen from 155.18 yen. The euro cost $1.0226, down from $1.0363.
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