Asian Markets Take a Hit: Japan’s Nikkei Falls Nearly 8% Following Wall Street’s Dramatic Crash

BANGKOK — Asian stock markets took a serious hit after a rough Friday on Wall Street. The chaos started with U.S. President Donald Trump’s hike in tariffs and China’s strong response.

As the dust settled, the futures market for the S&P 500 fell by 2.5%, while futures for the Dow Jones and the Nasdaq dropped by 2.1% and 3.1%, respectively. The Nikkei 225 in Tokyo plummeted nearly 8% at opening and settled down 6% to 31,758.28. Trading was so frantic that a circuit breaker paused trading for Topix futures temporarily.

In Japan, Mizuho Financial Group’s shares fell by 11.3%, and Mitsubishi UFJ Financial Group saw a 9.9% drop. Concerns about the effects of the trade war on the global economy weighed heavily on investors. Meanwhile, China’s markets, which typically move independently, also suffered significant losses. The Hang Seng in Hong Kong fell by 9.4%, and the Shanghai Composite was down by 6.2%. Tech giants like Alibaba and Tencent experienced drops of 10% and 9.4%, respectively.

The decline in Asian markets mirrors the turmoil in oil prices. U.S. crude oil benchmark dropped by 4%, now priced at $59.49 per barrel, with Brent also decreasing by $2.25 to $63.33.

Currency trading demonstrated uncertainty, with the U.S. dollar falling to 146.70 yen from 146.94. The euro also weakened against the dollar, slipping to $1.0926.

Friday’s turmoil reflects the largest market downturn since the COVID crisis. The S&P 500 dropped 6%, while the Dow and Nasdaq lost 5.5% and 5.8%, respectively. The trade war’s escalation, fueled by China’s tariffs on U.S. goods, could lead to wider economic repercussions.

Experts highlight the growing fear of a global recession stemming from this trade conflict. Currently, the S&P 500 is down 17.4% from its peak in February this year. Nathan Thooft from Manulife Investment Management warned that retaliatory tariffs from other countries are likely, suggesting that "market uncertainty and volatility are likely to persist."

Notably, recent data from the Federal Reserve indicates that the economic effects of tariffs could inflate consumer prices, further complicating the matter. Fed Chair Jerome Powell emphasized the need to keep inflation expectations stable amidst this turmoil.

Despite the disarray, Trump suggested on social media that it could be a "great time to get rich," showcasing the discrepancy between his administration’s optimism and the reality faced by everyday investors.

As the market reacts to these turbulent events, it remains unclear how long the tariffs will last or how countries will respond to them. Investors are left on edge, hoping that negotiations can ease the situation before it spirals further out of control.

For more information on current market trends and economic implications, you can explore reports from the Federal Reserve and other financial analyses.

Check out this related article: Asian Stocks Plunge: How Trump’s Tariffs Are Impacting Markets