By Marketwatch and Associated Press
Asian markets fell in early trading Tuesday after the Trump administration sparked trade tensions on new fronts.
President Donald Trump said Monday morning he will reinstate tariffs on Brazilian and Argentinian steel, accusing both countries of devaluing their currencies. Later, the Office of the U.S. Trade Representative threatened to impose tariffs of up to 100% on about $2.4 billion in French imports in retaliation for taxes on U.S. tech companies.
“The U.S. administration continues to play the risky game of weaponizing U.S. economic power with tariffs,” Stephen Innes, chief Asia market strategist with AxiTrader, said in a note Monday. “Also, investors are getting a bit anxious about whether the U.S. will postpone the imposition of more tariffs on Chinese products planned for Dec. 15.”
Japan’s Nikkei /zigman2/quotes/210597971/delayed JP:NIK +1.73% fell 0.7% and Hong Kong’s Hang Seng index /zigman2/quotes/210598030/delayed HK:HSI +0.10% slipped 0.2%. The Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.15% retreated 0.3% while the Shenzhen Composite /zigman2/quotes/210598015/delayed CN:399106 -0.09% dropped 0.3%. South Korea’s Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.24% declined 0.4% while benchmark indexes in Taiwan /zigman2/quotes/210597977/delayed TW:Y9999 +0.56% , Singapore /zigman2/quotes/210597985/delayed SG:STI -2.17% and Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX -0.06% were mixed. Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +2.16% slid 1.9% as the Reserve Bank of Australia kept rates unchanged, as expected.
Among individual stocks, SoftBank /zigman2/quotes/207303954/delayed JP:9984 0.00% sank in Tokyo trading, as Nissan /zigman2/quotes/208298710/delayed JP:7201 +0.46% and robotics maker Fanuc /zigman2/quotes/202054799/delayed JP:6954 +1.34% also fell. Nintendo rose after a report that its Switch videogame console were a hit with Black Friday shoppers in the U.S. In Hong Kong, Apple component makers AAC /zigman2/quotes/201441510/delayed HK:2018 +3.64% and Sunny Optical /zigman2/quotes/206687505/delayed HK:2382 +1.05% rose while CSPC Pharmaceutical /zigman2/quotes/200847219/delayed HK:1093 +1.18% and food processing company WH Group /zigman2/quotes/204247792/delayed HK:288 -0.47% fell. Chip maker SK Hynix /zigman2/quotes/206420319/delayed KR:000660 +0.12% declined in South Korea, as did Hyundai Heavy Industries /zigman2/quotes/206598861/delayed KR:009540 +4.88% , after its planned merger with shipbuilding giant Daewoo Shipbuilding & Marine Engineering Co. /zigman2/quotes/209608086/delayed KR:042660 +8.24% ran into regulatory problems in Singapore. In Australia, Westpac /zigman2/quotes/203084975/delayed AU:WBC +2.13% , Commonwealth Bank /zigman2/quotes/200638713/delayed AU:CBA +0.49% and National Australia Bank /zigman2/quotes/210431826/delayed AU:NAB +2.67% all fell.
U.S. stocks fell their most in about eight weeks on the renewed trade jitters and manufacturing data that showed a continued contraction in November.
The S&P 500 index /zigman2/quotes/210599714/realtime SPX +0.24% fell 0.9% to 3,113.87. The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA -0.04% dropped 1%, to 27,783.04. The Nasdaq /zigman2/quotes/210598365/realtime COMP +0.43% lost 1.1%, to 8,567.99.
The negotiations to end the longstanding trade war could face a tougher path this month following a flareup over Hong Kong.
China said Monday it will suspend U.S. military ship and aircraft visits to the semi-autonomous territory. It also plans to sanction several American pro-democracy groups in retaliation for passage of legislation supporting months’ long anti-government protests.
The law, signed last Wednesday by President Donald Trump, mandates sanctions on Chinese and Hong Kong officials who carry out human rights abuses and requires an annual review of the favorable trade status that Washington grants Hong Kong.
“Perhaps the market will now hold the champagne corks that it has been popping for months now in expectation that all is well,” Rabobank said in a report.
Benchmark crude oil gained 22 cents to $56.18 a barrel in electronic trading on the New York Mercantile Exchange. It rose 79 cents to $55.96 a barrel on Monday. Brent crude oil , the international standard, gained 18 cents to $61.10 a barrel.
The dollar /zigman2/quotes/210561789/realtime/sampled USDJPY +0.0325% rose to 109.20 Japanese yen from 109.00 yen on Monday.