You are here
Asia: Stocks fall as Trump's China tariff threat rattles market
[BENGALURU] Southeast Asian stock markets fell on Friday after US President Donald Trump proposed a 10 per cent tariff on remaining US$300 billion worth of Chinese imports from next month, intensifying the year-long trade war between the world's two largest economies.
If implemented, this move would extend trade duties to nearly all of China's exports to the United States and mark a sudden end to a temporary truce in the trade row that has hampered world growth and disrupted global supply chains.
"Markets are reeling after Trump expressed his frustration with China's stalling techniques... If there was any doubt that the US-China trade negotiations are drifting further apart, this latest trade escalation puts that debate to rest," said Stephen Innes, managing partner at VM Markets.
Mr Trump's surprise announcement comes hot on the heels of two-day trade talks in Shanghai that ended without any significant progress.
Thai stocks fell 1.3 per cent to six-week lows, extending losses into a second session, as a plunge in oil prices overnight pressured energy players. Oil and gas major PTT Exploration and Production PCL slumped 4.1 per cent.
Philippine shares stumbled 1.1 per cent, hit by losses in financial and real estate stocks. Property developer SM Prime Holdings Inc and lender BDO Unibank Inc slipped 2.5 per cent and 1 per cent, respectively.
Singapore shares slipped for a third straight session and hit their lowest in nearly two months, ahead of July business activity data. The data is expected to disappoint as the electronic hub battles a global tech slump and the repercussions of the US-China trade tiff, according to a note from ING.
In other news, lender Oversea-Chinese Banking Corp reported steady second-quarter earnings, while profit jumped at rival United Overseas Bank with improved margins and loan growth providing support in a slowing economy.
Analysts, however, expect Singapore banks' performance to weaken as a decline in interest rates and a faltering economy put pressure on the sector's profit and revenue growth after three strong years.