Asian markets plunge as Trump threatens to hike China tariffs

Hong Kong, May 6: President Donald Trump sent Asian markets plunging Monday after threatening to hike tariffs on $200 billion of Chinese goods at the end of the week in a bid to speed up stuttering trade talks between the economic superpowers.

Shanghai and Hong Kong equities led big losses across the region, with the Chinese yuan also taking a battering after the president threw a spanner into the high-level negotiations, which many observers were expecting to wrap up imminently.

“For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods,” Trump tweeted Sunday night. “The 10% will go up to 25% on Friday.”

The warning will throw a shadow over the next round of talks, with a delegation from Beijing due in Washington this week, with Bloomberg News reporting the Chinese side are considering their position.
The two sides have imposed tariffs on $360 billion in two-way trade since last year. But Trump and his Chinese counterpart Xi Jinping agreed a truce in December, helping fan a surge across world stock markets for the past four months.

“Trump has taken the proverbial sledgehammer to the walnut this morning and the only two words likely to be on the minds of traders and investors this week are 'trade talks',” said OANDA senior market analyst Jeffrey Halley.

In early trade Hong Kong tumbled 2.5 percent and Shanghai was off more than three percent, with Singapore off 2.8 percent, Taipei 1.5 percent off, while Sydney and Wellington were each one percent down.
Manila and Jakarta were also sharply lower. Tokyo and Seoul were closed for holidays.

 

(AFP/APP)

Posted on: 2019-05-06T08:52:00+05:00

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