Japanese Stocks Drop as Trump Tariffs Fuel Trade War Fears
Japanese stocks fell, dragging the benchmark Topix index down more than 2%, as concerns about a global trade war spurred widespread selling among exporters such as technology companies and automakers.
The Topix fell 2% to 2,733.86 as of 9:03 a.m. in Tokyo, with the automakers index leading decliners among 33 industry groups. The Nikkei 225 Stock Index fell 2.2% to 38,683.97. Of the 1,696 stocks in the index, 135 rose and 1,458 fell, while 103 were unchanged.
The dollar surged in early Asian trade and stocks were poised for losses across the region after U.S. President Donald Trump carried out his threat to impose blanket levies of 25% on Canada and Mexico and 10% on Chinese goods starting Tuesday. With Trump’s levies in place, Chinese President Xi Jinping has a variety of ways to respond, other than retaliatory tariffs.
“Trump’s decision to raise tariffs will hurt GDP in the U.S. and the targeted countries, and will also lead to increased inflationary pressures,” said Ryuta Otsuka, a strategist at Toyo Securities Co. “There are also Japanese companies in the manufacturing industry, such as automakers and auto parts makers, that have production bases like Mexico.”
Source: Bloomberg
