The Asian stock markets have dropped when the shock waves of US President Donald Trump continue to sustainably sail worldwide.
The most important indices from Shanghai to Tokyo and Sydney to Hong Kong plunged on Monday. “It’s a bloodbath,” said an analyst of the BBC.
As a region that produces so many of the goods sold worldwide, Asian countries and territories are directly affected by the tariffs.
They are also particularly sensitive to the effects of the fears that a global trade war could trigger a slowdown or even a recession in the largest economy in the world.
Japan’s Nikkei 225 -benchmark index closed by 7.8%, the ASX 200 lost 4.2% in Australia and the Kospi in South Korea ended 5.6% lower.
Burglaries on the Chinese mainland, Hong Kong and Taiwan were tightened when the investors caught in the big falls on Friday, which could be seen in other markets when they were closed for public holidays.
The Shanghai Composite closed 7.3% lower and the index, weighted in Taiwan, lost 9.7%.
The Hang Seng had dropped by 12.5%
“The tariffs feed in the expectations of inflation and a recession,” said Julia Lee, head of customer reporting at FTSE Russell, a subsidiary of the London Stock Exchange Group.
Goldman Sachs is now predicting a 45% chance that the United States will fall into a recession in the next 12 months -compared to an earlier estimate of 35% -since investment banking giant lowered its economic growth forecast for the country.
Other Wall Street companies have also revised their recession forecasts after Trump’s tariff termination. JPmorgan now sees a chance of 60% on a US and global economic downturn.
A significant slowdown in the US economy would have a significant impact on Asian exports because the United States is such an important market for goods from the region.
“Asia bears the main burden of the US tariff increase. While there could be some negotiating space, a new regime with higher tariffs remains here to stay”, Qian Wang, Chief Economist of the investment company Vanguard in Asian -Pacific.
“This is negative for the global and Asian economy, especially for these small open economies, both short -term and long -term.”
Countries from Vietnam to Bangladesh stopped to a high degree in the United States as an export market.
Trump’s announcement last week included a 46% tariff on Vietnam and 37% on Bangladesh.
Several large US brands were producing in Vietnam. including Nike and Lululemon.
Bangladesh exports USD 8.4 billion (6.5 billion GBP) of clothing in the United States, according to the Bangladesch clothing manufacturer and exporter association.
“Asia will probably feel a disproportionate main burden of this turbulence, since Asia sends more exports to the United States than in other markets,” said Frank Lavin, former head of the understatement for international trade in the US Ministry of Trade.
On Friday the The global turbulence of the stock market markets deepenedAfter China had repelled the tariffs announced by Trump.
All three large US stock indices have decreased by more than 5%, with the S&P 500 fell by almost 6%, which has limited the worst week for the US stock market since 2020.
In Great Britain, the FTSE 100 immersed almost 5% – the steepest decline in five years, while the exchange in Germany and France was exposed to similar declines.
Ms. Lee also emphasized that the global stock market trout should continue: “The US Futures trade with a lower point with another hard session on Wall Street tonight.”
The global stock markets have lost a value of trillions, since Trump has announced a certain 10% import tax for goods for goods from every country with products from dozens of countries, including important trading partners such as China, the European Union and Vietnam, with products from dozens of countries with far higher interest rates.
