Asian shares sink lower on escalated US-China trade war
Hong Kong's Hang Seng Index sank 1.72% while the Shanghai Composite Index fell by 0.67%. Japan's Nikkei 225 was down by 1.13%.
Shares in Asia reacted in tandem with the slump in Wall Street overnight as the trade war between the United States (US) and China intensified.
At around 10.00am Hong Kong time, the Hang Seng Index was lower by 1.72% or 492.09 points at 28,058.15.
China’s Shanghai Composite Index eased 0.67% or 19.42 points, to 2,884.30 while the Shenzhen Composite Index fell by 0.90% or 14.02 points, to 1,537.73.
Australian shares were down by 1.17% while Japan’s Nikkei 225 sank 1.13% or 239.54 to 20,952.75.
China on Monday announced plans to impose higher tariffs on US$60 billion worth of US goods after the US hiked US$200 billion worth of Chinese imports last week.
Overnight, the Dow Jones Industrial Average fell by 2.38% or 617.38 points, to 25,324.99, while the Nasdaq Composite plunged 3.41% or 269.92 points, to 7,647.02. The S&P 500 fell by 2.41%.
After trade talks with the US ended without progress, the offshore yuan slacked to past $6.9 per US dollar for the first time this year. The slump in China’s currency will hurt Chinese equities as most of the firms generate their earnings in Chinese yuan.
Experts have warned that a prolonged trade war will lead to a slowdown in global growth which would dent corporate profits and dampen the renewed optimism of a global economy on a rebound.
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