Asian stock markets fell sharply overnight and investors braced for even deeper losses in New York as the impact of US President Donald Trump's tariff announcements entered a second week.
Asian shares broadly fell to new lows after Mr Trump said he would not lift his massive import tariffs unless other countries brought their trade practices into line with the US.
In Japan, the Nikkei 225 index, which tracks the country's 225 largest publicly traded companies, fell about 6.5% on Monday morning.
The index was on the verge of falling below its lowest level since August last year.
China's Shanghai Composite Index, which tracks shares on the country's main stock exchange, fell more than 8 percent, while Hong Kong's Hang Seng Index lost more than 12 percent.
The latest moves come after Britain's leading FTSE 100 stock index posted its biggest one-day fall since the start of the COVID-19 pandemic on Friday.
And global financial markets are bracing for another day of sharp losses.
The U.S. S&P 500 and Dow Jones indexes are expected to open lower on Monday after a two-day sell-off that has seen the indexes lose billions of dollars.
The US president said on Monday evening that he does not want global markets to fall but is not worried about the current sell-off, adding: “Sometimes you have to take action to fix something.”
Mr Trump, who spent the weekend in Florida playing golf, last week imposed a series of tariffs on countries around the world, including a 10 per cent “base” rate on all US trading partners that took effect on Saturday.
In a new research note, a team of Deutsche Bank analysts noted that “markets are still reeling from the US announcement of retaliatory tariffs last week, which is causing investors to price in the growing likelihood of a US recession.”
“S&P 500 futures have fallen another 3.55% overnight so far, and if that happens, the index will fall into bear market territory today, down more than 20% from its mid-February closing peak,” the analysts warned.
“As such, the scale of the sell-off is now approaching the sharpest declines in a decade.
“Looking ahead to the coming week, tariffs will certainly be the main topic, but the big question is how other countries might respond to this.
“This is something that markets are watching closely, as it was China's response that triggered the fresh sell-off on Friday.”
China's 34% retaliatory tariff on U.S. exports to China will take effect on Thursday.
Sourse: breakingnews.ie
