AFP, Hong Kong :
Asian markets kicked the week off with sharp losses Monday as investors prepare for the US to impose hefty tariffs on a range of Chinese imports, taking their trade row to another level.
The levies on billions of dollars of goods, which are due Friday, come after data at the weekend showed Chinese manufacturing activity slowed in June as the world’s number two economy shows signs of struggling.
Fears of a trade war have rattled world markets and particularly China’s, which are now in bear territory having fallen 20 percent from their recent highs.
“China’s economy will slow down for the rest of the year, but we don’t need to worry about any stall yet,” Zhu Qibing, chief macroeconomy analyst at BOC International China in Beijing, said. “The key is how international trade and the dispute between China and the US will evolve.”
On Monday, Shanghai dived 2.5 percent, while the Chinese yuan extended a retreat that has led some observers to suggest the country’s central bank is weakening the unit to offset the impact of a trade war.
While China is a key target in Donald Trump’s protectionist America First agenda, he has also set his sights on allies including the European Union and Canada, which on Friday imposed hefty tariffs on $12.6 billion of US goods in retaliation for US measures on aluminium and steel.
Tokyo tumbled 2.2 percent as a closely watched gauge of Japanese business showed sentiment was softening.
The Bank of Japan’s Tankan report – a quarterly survey of about 10,000 companies – showed a dip in confidence from the previous three months, though economists pointed out that it is still around its highest level in more than a decade.
In other markets Seoul dropped 2.4 percent, Sydney shed 0.3 percent and Singapore retreated 0.9 percent, while Taipei gave up 0.5 percent and Wellington was flat.
Hong Kong was closed for a public holiday.
In early European trade London fell 0.7 percent, Paris shed one percent and Frankfurt lost 1.3 percent.
Asian markets kicked the week off with sharp losses Monday as investors prepare for the US to impose hefty tariffs on a range of Chinese imports, taking their trade row to another level.
The levies on billions of dollars of goods, which are due Friday, come after data at the weekend showed Chinese manufacturing activity slowed in June as the world’s number two economy shows signs of struggling.
Fears of a trade war have rattled world markets and particularly China’s, which are now in bear territory having fallen 20 percent from their recent highs.
“China’s economy will slow down for the rest of the year, but we don’t need to worry about any stall yet,” Zhu Qibing, chief macroeconomy analyst at BOC International China in Beijing, said. “The key is how international trade and the dispute between China and the US will evolve.”
On Monday, Shanghai dived 2.5 percent, while the Chinese yuan extended a retreat that has led some observers to suggest the country’s central bank is weakening the unit to offset the impact of a trade war.
While China is a key target in Donald Trump’s protectionist America First agenda, he has also set his sights on allies including the European Union and Canada, which on Friday imposed hefty tariffs on $12.6 billion of US goods in retaliation for US measures on aluminium and steel.
Tokyo tumbled 2.2 percent as a closely watched gauge of Japanese business showed sentiment was softening.
The Bank of Japan’s Tankan report – a quarterly survey of about 10,000 companies – showed a dip in confidence from the previous three months, though economists pointed out that it is still around its highest level in more than a decade.
In other markets Seoul dropped 2.4 percent, Sydney shed 0.3 percent and Singapore retreated 0.9 percent, while Taipei gave up 0.5 percent and Wellington was flat.
Hong Kong was closed for a public holiday.
In early European trade London fell 0.7 percent, Paris shed one percent and Frankfurt lost 1.3 percent.
