Asian and European shares sank again on Wednesday as the latest set of U.S. tariffs, including a 104% levy on Chinese imports, went into effect
The Latest: Asia and European shares sink as US tariffs take effectBy The Associated PressThe Associated Press
Asian and European shares slid on Wednesday, with Japan’s Nikkei 225 dipping more than 5%, as the latest set of U.S. tariffs including a massive 104% levy on Chinese imports took effect.
The Nikkei 225 lost 3.9% to 31,714.03. In Hong Kong, the Hang Seng lost 0.4% to 20,041.03, while the Shanghai Composite index reversed early losses, gaining 0.9%. to 3,173.56. Taiwan led losses in Asia, as its Taiex plunged 5.8%.
China said it will take “resolute measures” to defend its trading rights, but gave no details on how it will respond to U.S. moves.
On Tuesday, the S&P 500 dropped 1.6% after wiping out an early gain of 4.1%. That took it nearly 19% below its record set in February. The Dow Jones Industrial Average dropped 0.8%, while the Nasdaq composite lost 2.1%. Uncertainty is still high about what President Donald Trump will do with his trade war. The sharply higher tariffs kicked in as of midnight Eastern time in the U.S.
More swings up and down for financial markets are excepted given the uncertainty over how long Trump will keep the stiff tariffs on imports, which will raise prices for U.S. shoppers and slow the economy. If they last a long time, economists and investors expect them to cause a recession. If Trump lowers them through negotiations relatively quickly, the worst-case scenario might be avoided.
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Here’s the latest:
China says it will take “resolute measures” to defend its trading rights
China said it will take “resolute measures” to defend its trading rights, but gave no details on how it will respond to U.S. moves that have pushed tariffs on Chinese goods to an unprecedented 104%.
Foreign Ministry spokesperson Lin Jiang said at a daily briefing Wednesday that China would “by no means” accept the U.S. tariff hikes and extreme pressure exerted on China.
Lin repeated China’s assertion that it would “fight to the end” against what it has described as trade bullying by the U.S., but did not say whether it would add to the 34% tariffs earlier announced on U.S. imports or apply other means. And Lin repeated Beijing’s belief that the U.S. must first “demonstrate sincerity for talks.”
India’s Central Bank cuts key repo rate by 25 basis point
India’s Central Bank cut its key repo rate by 25 basis points on Wednesday, in a move to aid the sluggish economy that faces heat from the U.S reciprocal tariffs which are set to dampen New Delhi’s aspirations for an export-led recovery.
The Monetary Policy Committee of the Reserve Bank of India unanimously voted to lower the repo rate to 6% for the second consecutive time this year, and changed its monetary policy stand from “neutral” to “accommodative.”
Governor Sanjay Malhotra said in a statement the latest tariffs have “exacerbated uncertainties clouding the economic outlook across regions, posing new headwinds for global growth and inflation.”
India continues to make steady progress though towards its goals of price stability, economic growth and inflation, but the Bank remains vigilant to the possible risks from global uncertainties, said Malhotra.
Bank of Japan calls meeting on global economy and markets.
Top officials from the Bank of Japan, the Finance Ministry and the Financial Services Agency met Wednesday to discuss the nation’s response to what they said were the recent shifts in the global economy and markets.
The unexpectedly called meeting was believed to be over Trump’s recent tariffs, which have set off gyrations in global financial markets, including the Tokyo Stock Exchange. Trump was not mentioned in the announcement about the meeting.
Attending the meeting were Koji Nakamura and Seiichi Shimizu, directors at the Bank of Japan, and two officials each from the ministry and the agency.
Asia markets close down
Japan’s Nikkei 225 lost 3.9% to 31,714.03. In Hong Kong, the Hang Seng lost 0.4% to 20,041.03, while the Shanghai Composite index reversed early losses, gaining 0.9%. to 3,173.56.
Taiwan led losses in Asia, as its Taiex plunged 5.8%. Big tech manufacturers were among the biggest decliners. Computer chip giant TSMC Corp. dropped 3.8% while iPhone maker Hon Hai Precision Industry plunged 10%.
South Korea’s Kospi lost 1.7% to 2,293.70, and the government said it would provide help for its beleaguered automakers.
The S&P/ASX 200 in Australia declined 1.8% to 7,375.00. Shares in New Zealand also fell.
In India, the Sensex declined 0.5% as the central bank cut its benchmark interest rate, while Bangkok’s SET shed 0.8%.
Asia markets slide after tariffs go into effect
Japan’s Nikkei 225 dipped more than 5% and other Asian shares also sank Wednesday as the latest set of U.S. tariffs, including a massive 104% levy on Chinese imports, took effect.
Markets have been wobbly for days, with investors flummoxed over what to make of President Donald Trump’s trade war.
On Tuesday, the S&P 500 dropped 1.6% after wiping out an early gain of 4.1%. That took it nearly 19% below its record set in February. The Dow Jones Industrial Average dropped 0.8%, while the Nasdaq composite lost 2.1%.
Stocks had rallied globally on Tuesday, with indexes up 6% in Tokyo, 2.5% in Paris and 1.6% in Shanghai. Any optimism or buying enthusiasm appeared to have dissipated by the time the sharply higher tariffs became reality.
The Nikkei 225 was down 4.7% at 32,475.57 as of mid-afternoon Tokyo time.
In Hong Kong, the Hang Seng lost 1.8% to 19,769.24, while the Shanghai Composite index edged just 4 points lower, to 3,141.46.
South Korea’s Kospi lost 1.9% to 2,290.87, while the S&P/ASX 200 in Australia declined 1.8% to 7,374.80. Shares in New Zealand also fell.
Bangladesh manufacturers worried about losing market share in US
Garment manufacturers and exporters in Bangladesh, the world’s second largest after China, are worried about losing its share in the apparel market of the United States, which is imposing new tariffs of 37%.
The U.S. is Bangladesh’s largest market as a single destination where the country’s nearly $39 billion industry exported apparel goods worth $7.34 billion in 2024.
Now, Bangladesh’s manufacturers say their U.S. buyers are halting orders, which could help competitors like India and Pakistan overtake Bangladesh in the U.S. market.
Bangladesh has already sought postponement of the application of the new tariff for three months to help the country assess the situation and smoothly implement its initiatives.
Asif Ashraf, managing director of Urmi Group, says they are worried about the U.S. market “because it will change the global equilibrium.” The sector employed about 4 million workers, mostly women from rural areas, and the industry accounts for about 80% of the country’s total annual exports.
South Korea launches emergency funding program for automobile industry
South Korea has launched an emergency funding program worth 3 trillion won ($2 billion) to help its automobile industry cope with the impact of increased tariffs imposed by the Trump administration.
The government package announced on Wednesday includes expanded low-cost financing from state-run lenders, as well as a new financing program backed by auto giants Hyundai and Kia, along with financial institutions, aimed at supporting struggling carmakers and auto parts manufacturers. The government will also expand subsidies for electric vehicle purchases.
Cars and auto parts stand as South Korea’s top export items to the United States, according to the Ministry of Trade, Industry and Energy, which raised concerns that the Trump administration’s imposition of a 25% tariff on these products will have a “significant shock” on the industry. The ministry says South Korea’s exports of automobiles to the United States totaled $34.7 billion last year, while exports of auto parts amounted to $8.2 billion.
Trump’s new tariffs go into effect, including a combined 104% levy on China
President Donald Trump’s sweeping new tariffs went into full effect just after midnight Wednesday.
When Trump announced the latest round of tariffs on April 2, he declared that the U.S. would now tax nearly all of America’s trading partners at a minimum of 10% — and impose steeper rates for countries that he says run trade surpluses with the U.S.
The 10% baseline already went into effect Saturday. Trump’s higher import tax rates on dozens of countries and territories took hold at midnight.
The steeper levies run as high as 50% — with that biggest rate landing on small economies that trade little with the U.S., including the African kingdom of Lesotho. Some other rates include a tax of 47% on imports from Madagascar, 46% on Vietnam, 32% on Taiwan, 25% on South Korea, 24% on Japan and 20% on the European Union.
Some of these new tariffs build on previous trade measures. Trump last week announced a tariff of 34% on China, for example, which would come on top of 20% levies he imposed on the country earlier this year. Trump has since threatened to add an another 50% levy on Chinese goods in response to Beijing’s recently promised retaliation. That would bring the combined total to 104% against China.
