Asian markets reeled under selling pressure on Monday as U.S.-China trade tensions escalated. Markets in Japan and South Korea were closed for holidays.
Risk sentiment took a hit after U.S. President Donald Trump said on Sunday that the U.S. would hike tariffs on $200 billion worth of Chinese goods this week, with further tariffs on $325 billion goods “shortly.”
Following Trump’s threats to impose higher tariffs, the South China Morning Post newspaper reported that Beijing is considering canceling the next round of trade talks with U.S. officials later this week.
Chinese stocks succumbed to heavy selling pressure as Trump’s comments unsettled investors who had been anticipating a trade deal as early as this week.
The benchmark Shanghai Composite Index plummeted 171.87 points or 5.6 percent to 2,906.46, while Hong Kong’s Hang Seng Index ended down 871.73 points or 2.9 percent at 29,209.82.
Australian markets hit a nearly two-week low before ending the session off their worst levels following Trump’s “threat” to hike tariffs and weak earnings results from banking giant Westpac.
The benchmark S&P/ASX 200 Index ended down 52.10 points or 0.8 percent at 6,283.70, while the broader All Ordinaries Index slid 57.30 points or 0.9 percent to 6,369.90.
Westpac dropped 1.2 percent after its half-year profit slumped 22 percent due to the impact of hefty customer compensation payouts at its wealth management arm. ANZ rose half a percent and NAB gained 1 percent.
Mining heavyweights BHP and Rio Tinto ended down around half a percent each, while smaller rival Fortescue Metals Group declined 2.1 percent.
Energy stocks such as Santos, Oil Search and Origin Energy all fell over 1 percent as oil prices fell more than 2 percent following Trump’s tariff threat against China. Beach Energy shares tumbled 3.2 percent.
Retail Food Group plummeted 8.9 percent after acknowledging it