Asian markets plunged on Monday, deepening a global stocks rout triggered by US President Donald Trump's trade war and China's forceful response to unexpectedly high tariffs. Japan's benchmark Nikkei fell by more than 8% shortly after opening, while the broader Topix index last traded more than 6.5% lower after recovering from its steepest losses. In mainland China, where markets reopened after a public holiday, the Shanghai Composite Index was last trading 6.7% lower. The blue-chip CSI300 index lost 7.5%. In Hong Kong, the benchmark Hang Seng index opened more than 9% lower. South Korea's Kospi tumbled more than 4.8% shortly after opening. Trading was halted for five minutes when a circuit breaker designed to prevent panic selling was triggered. Asian markets are tracking the worst two-day stretch for Wall Street stocks in five years. US stock futures plunged Sunday evening after two sessions of sell-offs that wiped away over $5.4 trillion in market value. US stocks fell sharply on Friday after China retaliated fiercely, imposing a 34% tariff on all US goods, raising fears of an escalating and damaging trade war fueled by continuing trade tension between the world's two largest economies. A commentary published Monday by the People's Daily, the ruling Chinese Communist Party's official mouthpiece, stressed that the country has a "strong capacity to withstand the pressure" in the face of "US tariff bullying." "Faced with America's reckless tariff punches, we know exactly what we're dealing with, and we have plenty of countermeasures at hand," it said. "After eight years of trade war with the US, we've built up a wealth of experience in this struggle." China's retaliation last week against the latest round of US tariffs was more sweeping than its earlier reciprocal actions and marked a significant escalation in its response, which triggered widespread market turmoil. Ronald Temple, chief market strategist at investment bank Lazard, wrote in a Monday research note that he was expecting broad-based retaliation from other countries in the weeks and months ahead. "As a result of these large tariff hikes, I now expect the economic damage to be more severe than would have been the case in a gradual escalation," he said. Taiwan's Taiex plummeted more than 9.7% after opening on Monday. Almost all Taiwanese stocks, including TSMC and Foxconn, two of the island's best-known export powerhouses, triggered circuit breakers, according to Taiwan's Central News Agency. Both TSMC and Foxconn fell about 10%. In Australia, the benchmark ASX 200 index fell as much 6.3% in morning trade, while New Zealand's NZX 50 lost more 3.5%. US stocks are set to open sharply lower Monday, putting the S&P 500 on the precipice of a bear market — a decline of 20% from its peak and an ominous sign for investors and perhaps the broader economy. Global investors were spooked by President Trump's massive tariff regime, some of which went into effect on Saturday morning, and even larger tariffs are set to launch on Wednesday. On Sunday evening, Trump told reporters aboard Air Force One that he didn't intentionally crash markets but declined to predict how stocks would trade in the future, which added to investors' concerns. "What's going to happen with the market? I can't tell you," Trump said. "But I can tell you, our country has gotten a lot stronger, and eventually it'll be a country like no other." The president, who has long fashioned himself a deal maker, laid out what it would take to get to a deal with China on tariffs. "I'm willing to deal with China, but they have to solve their surplus," he said. "We have a tremendous deficit problem with China." Last year, the US imported $438.9 billion worth of goods from China and exported $143.5 billion to the country, according to the Office of the United States Trade Representative. The president also said he wants to solve the deficit with the European Union and if they're open to that, he's open to discussion. Trump said he had fielded calls on tariffs from technology executives and world leaders over the weekend. Japanese Prime Minister Shigeru Ishiba said in parliament on Monday that he would continue to appeal to the US to reduce tariffs. On Wednesday, Trump imposed a 24% across-the-board tariff on Japan, a defense treaty ally, which is due to take effect later this week. Ishiba said he aimed to visit the US "as soon as possible" and wanted to convey the idea that Japan "is not doing anything unfair." In Taiwan, President Lai Ching-te said on Sunday that Taipei will negotiate with Washington to eliminate tariffs on both sides and actively resolve its non-tariff trade barriers. He added that Taiwan will purchase more US products to lower the trade deficit, and the island's defense ministry has put forward a military procurement list. "We want to make it clear to the US just how much Taiwan contributes to the US economy," Lai said. Economists at Barclays said Monday that they take a "cautious view" on the ability of Asian governments such as South Korea and Singapore to successfully negotiate with the US to bring down tariffs and have started the process of trimming economic growth forecasts for the region. — CNN
