The financial landscape is experiencing turbulence as a result of the recent imposition of 104% tariffs on China by the United States. This significant move, aimed at countering China’s retaliatory tariffs on American goods, has sent shockwaves through global markets. Following this announcement, Asian indices reflected a downward trend, mirroring the reaction seen in the US stock market.
Asian Markets React to Tariff News
On Wednesday, Asian stock markets took a hit, driven by renewed concerns over trade tensions. Japan’s Nikkei 225 plummeted by 2.82%, settling at 32,089. Meanwhile, South Korea’s Kospi dipped 0.56% to 2,321, and Hong Kong’s Hang Seng Index experienced a decline of 2.94%. The Shanghai Composite Index in China also fell, down 1.71% to 3,091.
- Nikkei 225: -2.82% to 32,089
- Kospi: -0.56% to 2,321
- Hang Seng: -2.94%
- Shanghai Composite: -1.71% to 3,091
Wall Street Plummets Amid Tariff Fears
The reaction on Wall Street was similarly grim. Following the announcement of the hefty tariffs, the Dow Jones Industrial Average dropped by 320 points, or 0.84%, closing at 37,645.59. The S&P 500 saw a loss of 1.57%, ending at 4,982.77, and the Nasdaq Composite decreased by 2.15%, wrapping up at 15,267.91.
Details on the Tariffs
Effective from 12:01 AM ET (0401 GMT) on Wednesday, the 104% tariff was a direct response to China’s lack of action in rolling back its own retaliatory tariffs. A White House official emphasized that this move was essential to protect American interests in the ongoing trade conflict.
Currency and Oil Market Updates
In the currency market, the US Dollar Index (DXY), which tracks the dollar against a basket of six major currencies, fell by 0.54% to 102.40. The Indian rupee also showed weakness, depreciating by 0.48% to close at 86.26 against the dollar on April 8.
In the world of crude oil, prices fluctuated on Wednesday. WTI crude was down 3.23%, trading at $57.66, while Brent crude saw a slight uptick of 2.75%, reaching $61.09.
FII and DII Activity
The latest data reveals that foreign institutional investors (FII) were net sellers, offloading shares worth ₹4,994.24 crore. Conversely, domestic institutional investors (DII) stepped in as net buyers, acquiring shares valued at ₹3,097.24 crore on April 8.
Gold Prices Take a Hit
In the commodities market, gold prices are feeling the pressure. The price for 24-carat gold has dropped by 1.7% from last week, currently standing at ₹87,850 per 10 grams. However, it remains 2.4% higher compared to a month ago. The rates for 22-carat gold and 18-carat gold are ₹80,529 and ₹65,888 per 10 grams, respectively.
Cryptocurrency Market Under Pressure
The ripple effect of Trump’s tariffs reached the cryptocurrency market, with Bitcoin’s price sliding below $77,000. Additionally, reports indicate that the US Justice Department is dissolving its National Cryptocurrency Enforcement Team, refocusing efforts on serious criminal activities such as drug trafficking and terrorism.
The ongoing developments in the global economy highlight the interconnected nature of markets and the substantial impact of policy changes. As investors navigate these turbulent waters, keeping an eye on economic indicators and market trends will be crucial.
