Hong Kong Stocks Plunge After Beijing Retaliates Against Trump Tariffs
China and Hong Kong stocks fell sharply on Monday after Beijing retaliated with massive U.S. tariffs, deepening fears of a protracted trade war between the world’s two largest economies.
The Shanghai Shenzhen CSI 300 Index fell nearly 6%, while the Shanghai Composite also fell 6%. Both indexes hit their lowest levels since late September 2024.
Hong Kong’s Hang Seng plunged 8.8% to its lowest since early February, led by technology and export-oriented companies.
Tensions escalated sharply last week when U.S. President Donald Trump pressed ahead with a new wave of tit-for-tat tariffs, with an additional 34% tariff on China, on top of the 20% duties already in place. Trump also reiterated a 25% tariff on imports of cars and auto parts, which is scheduled to take effect on April 9.
Beijing has also retaliated with a broad 34% tariff on a range of U.S. imports, including agricultural products, energy commodities and key technology components.
The retaliatory tariffs have rattled global markets and raised concerns of a deeper slowdown in global trade.
"After a previously measured response to fentanyl tariffs that still gave hope for negotiations, it appears a second trade war is underway," ING analysts said in a recent note.
Hong Kong-listed shares of Alibaba (HK:9988) plunged 12%, while Baidu (NASDAQ:BIDU) Inc (HK:9888) shares fell more than 10%.
Technology, auto and industrial stocks bore the brunt of the losses, with big names such as BYD Co (HK:1211), Semiconductor Manufacturing International Corp (HK:0981) and SAIC Motor (SS:600104) falling between 6% and 11%.
Source: Investing.com
