Trump tariffs stay: FTSE opens sharply down after Asian markets plummet over commerce fears

Hong Kong’s Hang Seng index slumped more than 12 per cent in morning trade, which, if sustained, would make for the benchmark’s largest daily fall since the 2008 global financial crisis.

China’s CSI300 blue-chip index fell more than 5 per cent with selling in nearly every sector, while China’s yuan slipped to its lowest value since January and bonds rallied sharply. Beijing is facing a combined 54 per cent tariffs on US exports, and announced retaliatory measures on Friday – which was a public holiday.

Japan’s Nikkei 225 index plunged nearly 9 per cent after market opened in Tokyo. Australia’s S&P/ASX 200 dropped more than 6 per cent, while South Korea’s Kospi lost 4.4 per cent.

Hong Kong’s Hang Seng index slumped more than 12 per cent in morning trade.

If sustained, it will mark the benchmark’s largest daily fall since the 2008 global financial crisis.

US President Donald Trump warned foreign governments they would have to pay “a lot of money” to lift sweeping tariffs, characterising the duties as “medicine” and triggering further carnage across global financial markets on Monday.

Asian shares sank across the board and US stock market futures traded sharply lower as investors feared that Trump’s tariffs could lead to higher prices, weaker demand and potentially a global recession.

Speaking to reporters aboard Air Force One on Sunday, Trump indicated he was not concerned about losses that have already wiped out trillions of dollars in value from equity markets around the world.

“I don’t want anything to go down. But sometimes you have to take medicine to fix something,” he said as he returned from a weekend of golf in Florida.

Trump said he had spoken to leaders from Europe and Asia over the weekend, who hope to convince him to lower tariffs as high as 50 per cent due to take effect this week.

“They are coming to the table. They want to talk but there’s no talk unless they pay us a lot of money on a yearly basis,” Trump said.

Hong Kong’s stock market is one of the worst hit today, with the Hang Seng Index dropping 12.7 per cent as of this afternoon.

Hong Kong is on course for the benchmark’s largest daily fall since the 2008 global financial crisis.

On the mainland, the Shanghai Composite Index slumped 6.34 per cent during opening trade.

President Donald Trump is not intentionally trying to crash the stock market, the White House national economic council director Kevin Hassett has said.

Speaking on ABC’s This Week on Sunday, Mr Hassett said the stock market crash following Mr Trump’s tariff announcement was “not a strategy”.

He was questioned about it after Mr Trump shared a video on social media platform Truth Social that claimed the president was causing the markets to plummet as part of a larger economic plan.

Mr Hassett insisted: “He’s not trying to tank the market. He’s trying to deliver for American workers. It’s not a strategy for the markets to crash”.

Tokyo’s Nikkei 225 index lost nearly 8 per cent shortly after the market opened today.

By midday, it was down 7.2 per cent at 31,337.76.

A circuit breaker briefly suspended trading of Topix (Tokyo Stock Price Index) futures after an earlier sharp fall in US futures. A circuit breaker is a safety mechanism that is used to halt trade when the stock market experiences fluctuations.

Among the biggest losers was Mizuho Financial Group, whose shares sank 11.4 per cent. Mitsubishi UFJ Financial Group’s stock lost 10.7 per cent as investors panicked over how the trade war may affect the global economy.

US president Donald Trump’s tariff measures could slow euro area economic growth by anywhere between 0.5 and 1 percentage points, Greek central bank governor Yannis Stournaras said.

Mr Stournaras’ comments come against the backdrop of European Union countries weighing approval of a first set of targeted countermeasures on up to $28bn of US imports, covering products ranging from dental floss to diamonds, in the coming days.

The 27-nation bloc faces 25 per cent import tariffs on steel and aluminium and cars and “reciprocal” tariffs of 20 per cent from Wednesday for almost all other goods.In an interview with the Financial Times, Mr Stournaras warned that the looming global trade war risk sparking a large “negative demand shock” in the eurozone that could weigh heavily on Europe’s economic growth.

“A notable adverse impact on growth could lead to activity being much weaker than expected, dragging inflation below our targets,” he said.

A Downing Street spokesperson said:“The Prime Minister spoke to the Prime Minister of Canada Mark Carney this evening.

“They discussed their commitment to working together to maintain global economic stability in the wake of the announcement from the United States this week.

“An all-out trade war is in no-one’s interest, they agreed.

“Both agreed on the importance of free and open trade between like-minded nations, and the Prime Minister stated that trading blocs such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership will be important in this new global era.

“Prime Minister Carney thanked the Prime Minister for his leadership on Ukraine and reaffirmed his commitment to Canada playing a role in the Coalition of the Willing.

“Looking ahead, the Prime Minister said he was looking forward to travelling to Canada for the G7 Summit in June. They agreed to stay in close contact.”

India does not plan to retaliate against US president Donald Trump’s 26 per cent tariff on imports from the Asian nation, an Indian government official said, citing ongoing talks for a deal between the countries.

Prime minister Narendra Modi’s administration has looked into a clause of Trump’s tariff order that offers a possible reprieve for trading partners who “take significant steps to remedy non-reciprocal trade arrangements”, the official told Reuters.

New Delhi sees an advantage in being one of the first nations to have started talks over a trade deal with Washington, and is better placed than Asian peers like China, Vietnam, and Indonesia, which have been hit by higher US tariffs.

Taiwan’s president Lai Ching-te said this morning that the island does not seek to impose retaliatory tariffs against the US.

“Instead, we’ll start talking from bilateral ‘zero tariffs’,” said on X. “To ensure Taiwan’s competitiveness, we’ll increase US imports and adopt other measures. Working together, we’ll usher in a golden age of shared prosperity.”

US president Donald Trump last week imposed a 32 per cent imports duty on Taiwan, which has caused a big sell-off in markets this morning – Taiwan was observing a public holiday on Thursday and Friday so trading was closed.

Taiwan’s benchmark index has now dropped to its lowest level in more than a year and was poised for its biggest one-day percentage drop since at least 1990, LSEG data showed.

China, the EU and Canada have said they plan to retaliate with their own tariffs on US products. Beijing, which claims sovereignty over Taiwan, has already announced its own 34 per cent reciprocal tariffs on US goods.