Donald Trump has imposed a fresh round of tariffs of between 10% to 12.5% on dozens of countries, sending Asian equities lower overnight. Japan's Nikkei 225 shed 3.1% and South Korea's Kospi took a 6.2% hit, with a higher oil price adding to the pressure.
Asian stock markets sold off overnight after Donald Trump imposed a fresh round of sweeping trade tariffs. The US president announced a tariff of between 10% to 12.5% on dozens of countries, including the United Kingdom, Mexico, Canada, Australia, India, China and the 27 countries that make up the European Union.
The measure effectively replaces the blanket 10% tariff Trump imposed in February, which followed a US supreme court ruling that many of his earlier tariffs were illegal.
Asian indices bear the brunt
The tariffs reverberated across the region's stock indices. The Japanese Nikkei 225 shed 3.1%. Meanwhile, the Chinese SSE Composite fell 1.4%.
Hong Kong's Hang Seng dropped 11.4%. South Korea's Kospi took a 6.2% hit, an index heavily influenced by its huge chip companies.
A forced-labour rationale
The new levies are expected to fall under section 301 of the Trade Act of 1974, which targets countries that engage in forced labor. Trump had said his administration would investigate unfair trading practices to impose permanent tariffs as soon as the February court decision was announced.
Urging trading partners to adopt the same rules, US trade representative Jamieson Greer said: "it's well past time for our trading partners to do the same".
Oil and tech deepen the pressure
A higher oil price also weighed on sentiment, with Brent crude hitting $100 a barrel yesterday after a fresh escalation of the Middle East conflict. Many investors have likely been spooked by a sell-off in some major US tech names, amid worries about AI spending and after Tesla reported lower than expected profits.
Bank of France governor Emmanuel Moulin said the fresh tariffs will add more uncertainty to the world economy, and warned that the new levies could still disrupt the global economy.
Source: The Guardian
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