Trump's Tariff Hikes Pull Asian Shares Lower

Bangkok: Shares tumbled in Europe and Asia and US futures tumbled Thursday following US President Donald Trump's announcement of big increases in tariffs on imports of goods from around the world. The double-digit tariff hikes sent shivers across world markets, as economists warned it raises the risk of recession.

The future for the S&P 500 dropped 3.1 per cent while that for the Dow Jones Industrial Average lost 2.6 per cent, auguring potential losses when US markets reopen on Thursday. Germany's DAX fell 1.7 per cent to 21,998.48, while the CAC 40 in Paris lost 1.8 per cent to 7,716.66. Britain's FTSE 100 shed 1.2 per cent to 8,506.44.

In Asian trading, Tokyo's Nikkei 225 index dipped 4 per cent briefly, with automakers and banks taking big hits. It closed down 2.8 per cent at 34,735.93. Mitsubishi UFJ Financial Group's shares plunged 7.2 per cent as the potential impact of the 24 per cent tariffs on the export-dependent Japanese economy dashed expectations that the central bank will keep raising interest rates. Mizuho Financial Group skidded 8 per cent. Sony Corp's stocks sank 4.8 per cent and Toyota Motor Corp gave up 5.2 per cent. Japan's yen gained, with the US dollar falling to 147.42 Japanese yen from 149.28 yen. The euro rose to $1.0952 from $1.0855.

In South Korea, which was hit with a 25 per cent tariff, the benchmark Kospi fell 1.1 per cent to 2,486.70. Hong Kong's Hang Seng lost 1.7 per cent to 22,813.22, while the Shanghai Composite index edged 0.2 per cent lower to 3,342.01. The announcement came as a “major shock”, Yeap Junrong of IG said in a commentary. “China, in particular, was hit with an additional 34 per cent tariff, bringing its total tariff burden to 64 per cent when accounting for previous measures.” However, losses were partly blunted by expectations of further economic stimulus from Beijing to offset the impact of the higher tariffs.