Asian Shares Slump As Investors Brace For Trump's Reciprocal Tariffs

(RTTNews) - Asian stocks slumped on Monday as investors braced for U.S. President Donald Trump's reciprocal tariffs beginning April 2.

Trump announced that the upcoming tariffs on U.S. imports will apply to all nations, not just a select few.

It is feared that Trump's economic policies and possible retaliatory actions by targeted countries will fuel inflation, keep interest rates elevated and drag down global economic growth.

The Trump administration is optimistic about U.S. growth prospects but several key indicators that experts are monitoring suggest that the U.S. was being pushed into a recession.

A weaker dollar and falling bond yields lifted bullion to a new record high above $3,100 per ounce in Asian trade while oil was little changed after Trump threatened Russia with further oil sanctions.

Chinese shares ended slightly lower after rising earlier on the back of positive manufacturing data.

An official survey showed China's manufacturing activity expanded at its fastest pace in one year in March after policymakers pledged to step up monetary and fiscal stimulus.

The benchmark Shanghai Composite index dipped 0.46 percent to 3,335.75 while Hong Kong's Hang Seng index fell 1.31 percent to 23,119.58 on U.S. tariff fears.

Japanese markets plunged as Trump's tariff threats stoked fears over Japanese auto and tech export demand.

The Nikkei average slumped 4.05 percent to 35,617.56 while the broader Topix index settled 3.57 percent lower at 2,658.73.

Automakers led losses, with Toyota Motor, Honda, Mitsubishi and Nissan falling 3-4 percent. Market heavyweight SoftBank Group gave up 5.6 percent and Fast Retailing, the operator of Uniqlo, tumbled 3.7 percent.

Seoul stocks ended sharply lower on fears of escalating trading tensions and concerns about the global economic outlook.

The Kospi average lost 3 percent to close at 2,481.12, marking its lowest level in nearly two months as authorities lifted the short selling ban.

Among the prominent decliners, Hyundai Mobis, Hyundai Motor, Celltrion and LG Energy Solution declined 3-6 percent.

Australian markets fell on tariff worries and ahead of the RBI interest-rate decision due this week. The benchmark S&P/ASX 200 tumbled 1.74 percent to 7,843.40, dragged down by miners, financials and energy stocks. The broader All Ordinaries index closed 1.74 percent lower at 8,053.20.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 index slid 0.14 percent to 12,270.

Markets in Malaysia, India, Singapore, and Indonesia were closed for the Eid-ul-Fitr holiday.

U.S. stocks ended lower for a third straight session on Friday while Treasury yields fell as signs of reinvigorated inflation pressures amid souring consumer sentiment heightened concerns about the health of the U.S. economy.

Data showed the Federal Reserve's preferred inflation gauge of "core" PCE rose 0.4 percent month-on-month in February and 2.8 percent year-on-year, continuing a stubborn plateau on the path to the Fed's 2 percent target.

A measure of U.S. consumer sentiment in March plummeted to its lowest level since November 2022 while long-term inflation views rose to 32-year high of 4.1 percent.

The tech-heavy Nasdaq Composite plummeted 2.7 percent to a six-month closing low, the S&P 500 plunged 2 percent and the Dow slumped 1.7 percent.