Asian stock markets experienced a sharp decline on Monday (April 7) as the effects of US President Donald Trump’s “reciprocal” tariffs continued to unfold. Both Japan and Taiwan saw trading halted briefly due to panic selling, as investors expressed concerns about the growing risk of a recession and the possibility of US interest rate cuts as early as May.
In Japan, trading was paused for 10 minutes under the “circuit breaker” system after the Nikkei 225 futures were on track to fall more than 8 percent. The circuit breaker was activated at 8:45 am Tokyo time, affecting the Nikkei 225 and other futures contracts, though spot trading on the Tokyo Stock Exchange was not impacted. The Nikkei 225 initially dropped by 6.5 percent in early trading, recovering slightly after a nearly 9 percent decline.
Similarly, Taiwanese markets faced a steep decline, with the Taiex index falling by 9.8 percent at the open. As a result, Taiwan’s stock exchange also triggered a circuit breaker to manage the downturn. The drop marked the lowest point in Taiwan’s benchmark index in over a year. In response to the volatility, Taiwan’s financial regulator imposed temporary limits on short selling until Friday, aiming to stabilize the market.
Taiwan had previously tried to avoid the effects of Trump’s tariffs by increasing investments in the United States and purchasing more US energy. Despite these efforts, Taiwan was still hit by a 32 percent tariff on imports, excluding semiconductor chips. Key Taiwanese companies, such as chipmaker TSMC and electronics giant Foxconn, saw their shares drop close to 10 percent.
Other Asian markets were also significantly impacted. In Singapore, stocks fell by 8.5 percent, while South Korea’s Kospi dropped 4.8 percent. The Hang Seng Index in Hong Kong plunged 9.28 percent, and the Shanghai Composite Index in mainland China fell 4.21 percent.
Australian stocks were not spared either, with the benchmark index for the country’s largest 200 companies sinking 6 percent shortly after trading opened. In India, the Nifty 50 index fell 5 percent, while the BSE Sensex declined 5.29 percent during pre-opening trade.
Globally, the US market showed no signs of recovery, with futures contracts for major New York Stock Exchange boards sharply down, suggesting further losses for Wall Street stocks. S&P 500 futures fell by 4.31 percent, while Nasdaq futures dropped by 5.45 percent, continuing the downward trend from the previous week.
The market downturn across these regions highlights the growing concerns about the impact of global trade tensions and the ongoing uncertainty surrounding Trump’s tariff policies.
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