BANGKOK — Stock markets around the world, particularly in Asia, fell sharply Monday after U.S. President Donald Trump threatened to increase tariffs on imports from China at a time when many investors were banking on an easing in trade tensions between the two countries.
Investors started the new week on a downbeat tone after Trump said via Twitter that he planned to raise tariffs on imports from China to 25% from 10% as of Friday. Complaining that trade talks with China were moving too slowly, he also said he would impose tariffs on $325 billion worth of products from China, accounting for all of its exports.
He said: “The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!”
That knocked sentiment immediately in Asia, where the Shanghai Composite index closed 5.6% lower at 2,906.46 after plunging more than 6% earlier in the session. Hong Kong’s Hang Seng index sank 2.9% to 29,209.82.
That selling carried through into the European session and is expected to weigh on U.S. stocks at the bell.
In Europe, the CAC 40 in France was down 2% at 5,441 while Germany’s DAX skidded 1.8% to 12,187. London’s markets were closed for a bank holiday. U.S. stocks were also headed for a lower opening with Dow futures and the broader S&P 500 futures both down 2%.
Trump’s comments in tweets Sunday came as a Chinese delegation was due to resume talks in Washington on Wednesday aimed at resolving a tariffs battle that has rattled world markets.
The Wall Street Journal, citing unidentified sources, said China’s government was considering canceling this week’s talks. But a Chinese Foreign Ministry spokesman, Geng Shuang, said Monday that the delegation was still planning to go. He would not say exactly who might attend the talks.