New Delhi: Asian stock markets experienced a significant sell-off on Thursday following US President Donald Trump's announcement of reciprocal tariffs affecting several countries, including India. This decision sparked a wave of uncertainty, resulting in notable declines across major indices in the region.
The Nikkei 225 index in Japan fell by 2.69 percent, while Hong Kong's Hang Seng index decreased by 1.80 percent. Similarly, South Korea's KOSPI index saw a decline of 1.3 percent.
The negative sentiment extended beyond Asia, with US stock market futures also reflecting distress. Dow Jones Futures dropped by 1.78 percent, indicating a negative reaction from American markets to the tariff news.
Indian stock market futures were similarly pressured, with Gift Nifty futures declining by 1.11 percent ahead of Thursday's market opening, suggesting a likely lower start for Indian markets in light of the global downturn.
Banking and market expert Ajay Bagga informed ANI that the prevailing uncertainty has now solidified into a clear expectation of economic and financial challenges. "What was once uncertainty has transformed into a certainty of economic and market distress. The immediate response is to seek safe havens and divest from riskier assets. The repercussions for India will manifest through the US dollar, potential declines in exports and profit margins, and affected emerging market portfolio flows as investors turn to safer options like gold, the yen, the Swiss franc, and Japanese government bonds," he stated.
Bagga also cautioned that if currency wars commence, with China devaluing its currency to counter the tariffs, stock markets could face additional outflows and further declines.
The offshore China Internet ETF has experienced a decline of 6 percent, whereas the Vietnam Offshore Country ETF has dropped more significantly by 10 percent this morning.
On Wednesday (local time), US President Donald Trump revealed new import tariffs, detailing the rates that will be applied to various countries, including a 26 percent tariff on India.
Investors are now paying close attention to global events, as any further intensification of trade tensions may result in increased volatility in the financial markets.
