Fundamental Comment

Most Asian stocks slide as trade standoff deepens

Most Asian stocks slide as trade standoff deepens

Most Asian stocks fell on Monday after the United States and China imposed new tariffs on each other's imports, causing concerns about slowing global growth with no clear end to the trade war on the horizon.  

Japan’s Nikkei 225 index closed 0.41% down at 20,620.19 and Australia’s S&P/ASX 200 plunged 0.38 percent at 6,579.40, while Hong Kong Hang Seng index slumped 0.38 percent to 25,626.55 amid the non-stop protests.

However, Chinese shares deviated from the trend in the global markets, as the CSI300 index rose 1.28 percent at 3,848.32. 

In China, the Caixin/Markit Industrial Purchasing Managers' Index (PMI), a private sector survey, showed on Monday that factory unexpectedly expanded in August, although gains were modest and contradicted with official data indicating further contraction. 

Tensions deepened in financial markets after Washington imposed new tariffs of 15 percent on Chinese goods starting from September 1, while China retaliated by charging additional fees on U.S. goods worth $75 billion.  

Although U.S. President Donald Trump has said the two countries will hold talks in September, there are doubts that the talks will lead to a breakthrough. 

On the other hand, the Argentine government on Sunday agreed to impose currency restrictions in a direct confrontation by President Mauricio Macri, where the government said in a decree published in an official bulletin that the central bank is now authorized to restrict dollar purchases because it burned its reserves in an effort to support the peso. 

The central bank has burned nearly $1 billion in reserves since Wednesday in an effort to support the peso. However, the intervention did not have the desired effect, while the local peso extended the annual drop to 36 percent.

The U.S. dollar gained some haven demand to hit its highest level since May 2017 at 99.04, extending its advance for a sixth straight session.

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