Asia Markets Plunge as the Trade War Escalated with a Tit for Tat Between U.S. and China

Asia stocks traded lower in Monday morning on August 26, 2019, after the trade war between the U.S. and China had escalated into a whole new level, causing a plummet in not just Asia market, but global markets.

On Friday, August 23, 2019, China said that it will retaliate by imposing additional tariffs of 5% – 10% on U.S. products, including agricultural products such as soybeans, crude oil and small aircraft. China would also reinstituting tariffs on cars and auto parts from the U.S. as well.

Later, Trump salvoed back at China by demanding U.S. companies to cut ties with China and announced that he would raise tariffs again. 250 billion dollars worth of Chinese products will be imposed with 30% tariffs, up from 25% to be effective on October 1.

Tariffs on another $300 billion will go up to from 10% to 15% which will be imposed in two stages on September 1 and December 15.

 

A tit for tat happened after the trading hours in Asia markets, but the markets in Europe and the U.S. were during the trading session. On Friday, Dow Jones slipped 623.34 points or 2.37%, S&P 500 plunged 2.59% and Nasdaq fell 3%.

In Europe, DAX fell 1.15%, FTSE lost 0.47%, STOXX 600 slipped 0.78% and CAC closed flat.

 

Investors had two days during the weekend to wait and see if both economic giants would be willing to ease the tension which could plunge world economy easily. But after no positive signs were shown from any side, stocks in Asia markets continued to plunge in the morning session on August 26, 2019.

As of 9:12 local time in Bangkok, Nikkei plunged 2.32%, SSEC fell 1.15%, HSI sank 3.19%, ASX 200 slipped 1.55% and Kospi dipped 1.58%.

Some analysts had stated that aAs there are no ending to this trade war in sight, some of the developed countries had begun to dip into recession.