Global Stock Turmoil: Nikkei Crashes Nearly 8% as U.S.-China Tariff War Escalates

Markets across Asia reel after Wall Street suffers one of its worst plunges since the COVID-era crash; investor panic spreads as fears of a global recession intensify.

Global Stock Turmoil: Nikkei Crashes Nearly 8% as U.S.-China Tariff War Escalates

DECK
Markets across Asia reel after Wall Street suffers one of its worst plunges since the COVID-era crash; investor panic spreads as fears of a global recession intensify.

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KEY FACTS

• What: Asian stock markets experience widespread losses in response to U.S.-China trade conflict.

• Where: Japan, China, South Korea, Australia, and Hong Kong.

• When: Monday, following Wall Street’s dramatic decline on Friday.

• Who: Triggered by tariff increases from U.S. President Donald Trump and retaliatory measures by China.

• Impact: Japan’s Nikkei plunges nearly 8%; major banks and tech stocks hit hard.

• Oil & Currency: Crude oil dips sharply; U.S. dollar weakens against the yen and euro.

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SITUATION SNAPSHOT
Tokyo's financial district opened to a whirlwind of selling as panic from Wall Street's Friday collapse cascaded across Asian markets. Electronic boards flashed red across major exchanges, with investors dumping stocks in a scramble to minimize losses amid fears of prolonged economic fallout from the intensifying U.S.-China trade standoff.

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WHAT WE KNOW
Japan’s benchmark Nikkei 225 plummeted almost 8% at the opening bell, with losses moderating to 6% by midday, landing at 31,758.28. A temporary halt in trading was triggered after futures for the Topix index dropped too sharply. Financial giants bore the brunt: Mizuho Financial Group's shares dived 11.3%, while Mitsubishi UFJ Financial Group fell 9.9%.

Hong Kong’s Hang Seng plunged 9.4% to 20,703.30, and the Shanghai Composite Index declined by 6.2%. Leading Chinese tech firms were heavily impacted—Alibaba tumbled 10%, and Tencent slid 9.4%.

South Korea’s Kospi slid 4.1%, and Australia’s S&P/ASX 200 fell 3.8%, recovering slightly after an early drop of over 6%.

Crude oil took another hit as U.S. benchmark prices dropped 4%, down $2.50 to $59.49 per barrel. Brent crude slipped by $2.25, falling to $63.33 a barrel. Currency markets reflected the turmoil, with the U.S. dollar slipping to 146.70 yen and the euro easing to $1.0926.

Wall Street closed Friday with its sharpest declines since the height of the pandemic: the S&P 500 shed 6%, the Dow Jones dropped 5.5%, and the Nasdaq fell 5.8%.

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WHAT’S NEXT
Markets are expected to remain volatile, with analysts predicting continued swings as the trade dispute shows no signs of abating. China's retaliatory tariffs—matching the 34% levies imposed by the U.S.—are set to take effect on April 10. Economic observers await further statements from global central banks, particularly the Federal Reserve, regarding possible monetary policy responses.

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VOICES ON THE GROUND
"Ultimately, our take is market uncertainly and volatility are likely to persist for some time," said Nathan Thooft, chief investment officer and senior portfolio manager at Manulife Investment Management.

"It will take a considerable amount of time in our view to work through the various negotiations that are likely to happen."

Stuart Kaiser, head of U.S. equity strategy at Citi, cautioned investors in a Sunday note, stating: "There is ample space to the downside despite the large pullback."

White House trade adviser Peter Navarro urged calm, saying on Fox News: "People should just sit tight, let that market find its bottom, don't get shook out by the panic in the media."

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CONTEXT 
The ongoing tariff battle between the U.S. and China—economic giants responsible for over a third of global GDP—has now entered a high-stakes phase. While President Trump has acknowledged Americans may feel "some pain" from tariffs, he maintains the long-term benefits of returning manufacturing jobs to the U.S. justify the short-term strain.

From his Mar-a-Lago resort in Florida, Trump struck a characteristically bullish tone on social media, declaring: "THIS IS A GREAT TIME TO GET RICH."

Meanwhile, the Federal Reserve faces a delicate balancing act. While interest rate cuts could stimulate economic activity, Fed Chair Jerome Powell warned, "Our obligation is to keep longer-term inflation expectations well anchored and to make certain that a one-time increase in the price level does not become an ongoing inflation problem."

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REPORTER INSIGHT
As financial floors buzz with anxiety and traders monitor screens in disbelief, the ripple effect of geopolitical brinkmanship is vividly on display. This latest bout of volatility signals not just a market correction but a broader reckoning over how deeply interconnected trade, politics, and global stability have become.