Trump's tariffs cause market turmoil, dragging down Asia-Pacific trade

Asia-Pacific stocks, in red on Friday, tracked a sharp selloff on Wall Street overnight which wiped out $4 trillion in market value as US President Donald Trump’s sweeping tariffs stoked fears of an all-out trade war and a global recession. Trump unveiled a 10% baseline tariff on all imports, effective April 5, with around 60 countries facing steeper levies, including China (54%), the EU (20%), Japan (24%), India (27%), and Vietnam (46%). Japan ( NKY:IND ) fell 2.40% to around 34,000, while the broader Topix Index dropped 2.3% to 2,510 on Friday, extending losses from the previous session and hitting their lowest levels in about eight months. The Japanese yen held near a six-month around 146 per dollar on Friday, after surging nearly 2% in the previous session. Household spending in Japan fell by 0.5% y/y in February 2024, a reversal from a 0.8% increase in the previous month. Monthly, personal spending increased by 3.5%, reversing January's 4.5% decline and beating forecasts of a 0.5% gain. China ( SHCOMP ) market closed, and the offshore yuan strengthened to around 7.25 per dollar on Friday, extending gains from the previous session. In retaliation, China announced that it will soon restart negotiations with the EU to improve cooperation between Chinese and European companies, particularly in the electric vehicle sector. Hong Kong ( HSI ) market closed, India ( SENSEX ) fell 0.94% to 75,555 in early deals on Friday, marking a decline for the second straight session as most sectors retreated, hitting their lowest level in two weeks. The HSBC India Services PMI was revised higher to 58.5 in March 2025 from preliminary estimates of 57.7, but below the previous month of 59.0, marking the 44th consecutive month of growth in services activity. Australia ( AS51 ) fell 2.44% to close at 7,668 on Friday, extending losses from the previous session and hitting its lowest levels in almost eight months. The Australian dollar weakened toward $0.62 on Friday, reversing gains from the previous session, as risk aversion gripped financial markets amid mounting fears of a tariff-driven global recession. President Donald Trump’s decision to impose a 10% tariff on Australian goods is “not the act of a friend,” Prime Minister Anthony Albanese said Thursday, criticizing the move as illogical and contrary to the spirit of the U.S.-Australia alliance. “We will not join a race to the bottom that leads to higher prices and slower growth,” Albanese stated. In the U.S., on Thursday, all three major indexes ended in red facing their steepest decline in over two years on Thursday, as major stock indexes suffered sharp losses. U.S. stock futures declined further on Friday as President Donald Trump’s sweeping tariffs triggered a widespread selloff on Wall Street: Dow -0.26% ; S&P 500 -0.16% ; Nasdaq -0.12% . Investors now focus on Friday’s monthly jobs report, which could further shape expectations for the Fed’s next moves. Currencies: ( JPY:USD ), ( CNY:USD ), ( AUD:USD ), ( INR:USD ), ( HKD:USD ), ( NZD:USD ). More on Asia: Japan's Mar services PMI revised higher to 50; yen rallies amid trade war concerns Australia's trade surplus shrinks to 2020 low; imports surge, exports fall China's services growth hits 3-month high; yuan falls on Trump's aggressive tariffs China government debuts green sovereign bond offering Japan’s unemployment rate unexpectedly drops to 2.4% in February