Investing.com – Asian markets slumped in morning trade on escalating Sino-U.S. trade war. Hong Kong’s Hang Seng Index plunged more than 3%.
China’s Shanghai Composite and the were down 1.3% and 1.4% by 10:45 PM ET (02:45 GMT).
Sino-U.S. trade war escalated during the weekend. On Friday, U.S. President Donald Trump announced his decision to raise existing tariffs on $250 billion worth of Chinese goods to 30% from 25% as of October.
In addition, a new round of tariffs on $300 billion in goods will be taxed at 15%, up from the current 10%, he added.
The move came following China’s decision to impose retaliatory tariffs on another $75 billion of U.S. goods and vowed to fight the trade war to the end.
Separately, two top White House officials said Trump has the authority to force American companies to leave China, while the president himself said he could declare the trade war with China as a national emergency.
“In many ways this is an emergency,” Trump said at the G-7 leaders meeting.
“I could declare a national emergency, I think when they steal and take out and intellectual property theft anywhere from $300 billion to $500 billion a year and when we have a total lost of almost a trillion dollars a year for many years,” Trump said.
“Actually we are getting along very well with China right now, we are talking. I think they want to make a deal much more than I do. I’m getting a lot of money in tariffs its coming in by the billions. We’ve never gotten 10 cents from China, so we will see what happens.”
Hong Kong’s Hang Seng Index plunged 3.1% as tensions flared again in the city.
The Hong Kong police fired a shot in the sky on Sunday night amid violent protests. The police later said it was “the best option” to disperse hundreds of protesters. Six officers had their guns drawn.
“Our officer’s life was in great danger,” Yolanda Yu, a police senior superintendent, said at a briefing early Monday morning. “The use of force was indeed necessary and reasonable – it was to protect any person, including the officer himself, from death or serious bodily injury.”
In a sign that Beijing may be losing patience, state-owned media Xinhua said Hong Kong’s protests have turned into a “Color Revolution” aimed at overturning the Special Administrative Region’s constitutional institutions
“It’s not only China central government’s authority but also its responsibility to intervene when riots take place in Hong Kong,” the state-run Xinhua News Agency said Sunday in a commentary.
Japan’s Nikkei 225 fell 1.9% even after the U.S. and Japan agreed on Sunday a trade deal under which Japan will slash tariffs on U.S. beef, pork and other agricultural products.
South Korea’s KOSPI and Australia’s ASX 200 were both down 1.3%.
On the data front, the U.S. will releases data on GDP and durable goods this week, while China will report China industrial profits. Hong Kong retail sales and trade data are due later in the week.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.