Investor Panic Sets In as U.S.-China Tariffs Dispute Deepens

Asia-Pacific stock markets tumbled sharply today, driven by escalating tensions between the U.S. and China over trade tariffs. Investor sentiment soured as fears of a prolonged global trade war intensified following U.S. President Donald Trump’s latest tariff announcements. This led to a widespread sell-off across the region.

Hong Kong’s Hang Seng Index suffered the biggest loss in the region, plummeting by 12.53%. China’s CSI 300 also saw a significant decline, dropping 7.22%. Japan’s Nikkei 225 fell by 6.94%, reaching an 18-month low, while the broader Topix index plunged 6.50%, triggering trading halts in Japanese futures after circuit breakers were activated. South Korea’s Kospi index lost 4.74%, and the Kosdaq, which tracks smaller companies, dipped 4.01%. In Australia, the S&P/ASX 200 dropped 4.44%, bringing its losses since February to over 11%, officially entering correction territory.

India was also hit hard, with the Nifty 50 opening down by 3.85% and the BSE Sensex falling by 5.29%. These declines reflected growing investor anxiety about the potential impact of prolonged trade disputes on global economic growth.

Investor Panic Sets In as U.S.-China Tariffs Dispute Deepens

The commodities market also took a hit. Gold barely moved, up 0.04%, settling at $3,047.35 per ounce. Silver dropped by 0.48%, settling at $29.7, while oil prices saw a significant fall. Brent Crude slipped 2.95% to $63.65 a barrel, and West Texas Intermediate (WTI) crude fell by 2.94%, reaching $60.26 a barrel. The decline in oil prices reflected concerns over diminishing global demand as trade tensions threaten economic stability.

Meanwhile, key economic reports from the United States showed a mixed picture. Non-farm payrolls rose by 228,000 in March, exceeding expectations of 137,000. The unemployment rate edged up slightly to 4.2% from 4.1%. Despite the strong job numbers, traders remain wary of the long-term impact of trade tariffs on global supply chains and consumer demand.

The sell-off continued on Wall Street on Friday, where stocks experienced their largest one-day decline since June 2020. The Dow Jones Industrial Average plunged 2,231.07 points, or 5.5%, to 38,314.86. The S&P 500 dropped 5.97% to 5,074.08, while the Nasdaq Composite fell 5.8%, entering bear market territory with a 22% drop from its December peak.

Despite the sharp declines, senior U.S. economic officials have downplayed concerns over inflation and a potential recession, emphasizing that tariffs will remain in place regardless of market reactions. However, hopes for a resolution or negotiation of lower tariff rates with trade partners have all but faded, fueling further pessimism.

In the coming hours, market participants will be keeping an eye on the U.S. Consumer Credit report, set for release at 07:00 PM GMT, for any further economic clues.

Market sentiment remains fragile as investors brace for more volatility in the days ahead.

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