Asian Markets Fall as Trump’s Tariff Comments Stir Recession Fears
US Market Selloff Triggers Global Decline
Asian stock markets dropped after a sharp selloff in the US. The downturn followed former President Donald Trump’s comments on tariffs and the economy. When asked about recession concerns in a TV interview, Trump called the US economy a “period of transition.”
Since the interview aired on Sunday, Trump’s advisers have tried to reassure investors. “The previous notion of Trump being a stock market president is being re-evaluated,” said Charu Chanana, an investment strategist at Saxo Bank.
Markets React to Uncertainty
On Tuesday morning, Japan’s Nikkei 225 fell 1.7%, South Korea’s Kospi dropped 1.5%, and Hong Kong’s Hang Seng Index declined 0.7%.
US markets also struggled on Monday. The S&P 500 lost 2.7%, while the Dow Jones Industrial Average dropped 2%. The Nasdaq, which focuses on technology stocks, fell 4%. Tesla’s stock plunged 15.4%, and Nvidia lost more than 5%. Other major tech companies, including Meta, Amazon, and Alphabet, also saw sharp declines.
Investor Confidence Wavers
Financial experts say Trump’s unpredictability on tariffs is unsettling markets. “Trump is keeping political leaders guessing, but he’s also keeping investors guessing,” said Tim Waterer, chief market analyst at KCM Trade.
While a recession is not confirmed, the fear alone has made traders more defensive. After Monday’s market close, a White House official emphasized the difference between stock market fluctuations and actual business conditions. “What businesses and leaders are experiencing is more meaningful for the economy in the long term,” the official said.
Economic Uncertainty Grows
Last week, US markets erased gains made after Trump’s election. Initially, investors welcomed his policies due to expected tax cuts and deregulation. Now, they fear his tariffs will drive inflation and slow growth.
Rachel Winter, an investment manager at Killik & Co, warned that the tariffs will likely raise prices. “The level of tariffs Trump is imposing will cause inflation down the line,” she said.
Trump introduced tariffs after accusing China, Mexico, and Canada of failing to curb illegal drug and migrant flows. All three countries denied the allegations.
Conflicting Economic Views
Economist Mohamed El-Erian said investors underestimated the risk of a trade war. “Markets expected deregulation and lower taxes, but now they’re adjusting to a different reality,” he said. Signs of reduced spending by businesses and households add to economic concerns.
Despite the market turbulence, Trump’s economic adviser Kevin Hassett remains optimistic. In a CNBC interview, he argued that tariffs were already bringing manufacturing and jobs back to the US. “There are many reasons to be bullish about the economy,” Hassett said.
Although he acknowledged some short-term challenges, he attributed them to the timing of the tariffs and external economic factors.
Article souse :-BBC
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