Shanghai — Asian shares tumbled on Tuesday after US President Donald Trump stunned markets with tariffs against imports from Brazil and Argentina, recharging fears about global trade tensions, while weak US factory data added to the investor gloom.
In tweets on Monday, Trump said he would impose tariffs on steel and aluminium imports from Brazil and Argentina, attacking what he saw as both countries’ “huge devaluation of their currencies”. “Markets are extremely sensitive to any good or bad news on the US-China dispute front, but also the US relationship with other nations,” he said.
While trade war headlines have been a driver of markets in recent weeks, sentiment has broadly held up. The US S&P 500 index, the Dow Jones Industrial Average, the Nasdaq Composite and Australia’s S&P/ASX 200 index all touched record highs last week. Bearish sentiment on Tuesday pushed bond prices higher. The yield on benchmark 10-year Treasury notes fell to 1.8258% from a US close of 1.836% on Monday, and the policy-sensitive two-year yield, dipped to 1.608% from its US close of 1.614%.