SHANGHAI (Reuters) – Asian share markets were set for a bumpy ride on Friday just hours ahead of a U.S. deadline to impose tariffs on Chinese imports, which has rattled financial markets in recent weeks as investors feared it could trigger a full-blown global trade war.
FILE PHOTO: People walk past an electronic board showing Japan’s Nikkei average outside a brokerage in Tokyo, Japan, March 23, 2018. REUTERS/Toru Hanai
On Thursday, U.S. President Donald Trump confirmed that the United States would begin collecting tariffs on $34 billion worth of Chinese imports at 12:01 a.m. Washington time (0401 GMT) on Friday, and warned that subsequent rounds could see tariffs imposed on more than $500 billion worth of goods.
“The risk that further escalation derails growth is keeping some investors cautious,” ANZ analysts said in a note Friday.
The Sino-U.S. trade dispute has roiled financial markets including stocks, currencies and the global trade of commodities from soybeans to coal over the past several weeks.
Overnight gains in European and U.S. equities, however, provided some comfort for the start of Asian trading. MSCI’s broadest index of Asia-Pacific shares outside Japan inched up 0.05 percent, with some support from early gains in Korean and Australian shares.
Japan’s Nikkei stock index was 1.1 percent higher after closing at a three-month low on Thursday, while Australian shares gained 0.2 percent. Seoul’s Kospi index edged up 0.2 percent.
In Thursday’s Wall Street session, the Dow Jones Industrial Average rose 0.75 percent, the S&P 500 0.86 percent and the Nasdaq Composite 1.12 percent.
U.S. and European shares were boosted by reassuring economic data from Germany, and as automakers’ shares jumped, with German Chancellor Angela Merkel saying she would back lowering European Union tariffs on U.S. car imports after Washington offered to scrap threatened tariffs on European cars.