Asian shares sank Friday after U.S. stocks gave up much of their historic gains from the day before.
The deepening worries over President Donald Trump’ s trade war initially helped pull Japan’s Nikkei 225 share index down 5.6%.
By mid-morning in Tokyo, it was down 4.7% at 32,969.95.
The yen surged against the U.S. dollar, which also lost value against the euro.
One dollar bought 143.48 Japanese yen, down from about 146 yen a day earlier. The euro rose to $1.1305 from $1.1195.
South Korea’s Kospi fell 1.6% to 2,400.34, while in Australia, the S&P/ASX 200 shed 2.1% to 7,552.10.
Investors are viewing Trump’s decision to view a 90 day delay on higher tariffs for most countries as a ploy, not a pivot, Stephen Innes of SPI Asset Management said in a commentary.
“That’s the market hitting the brakes, hard. The sugar high from Trump’s tariff pause is fading fast, and Asia’s about to feel the comedown. The champagne’s flat, the party’s over, and the tape is twitching,” he wrote.
On Thursday, the S&P 500 tumbled 3.5%, slicing into Wednesday’s surge of 9.5% following Trump’s decision to pause many of his tariffs worldwide. The Dow Jones Industrial Average dropped 1,014 points, or 2.5%, and the Nasdaq composite tumbled 4.3%.
But China announced more countermeasures against the United States and losses for U.S. stocks accelerated after the White House clarified that the United States will tax Chinese imports at 145%, not the 125% rate that Trump had written about in his posting on Truth Social Wednesday, once other previously announced tariffs were included. The drop for the S&P 500 exceeded 6% at one point.
All told, the S&P 500 fell 188.85 points Thursday to 5,268.05. The Dow Jones Industrial Average dropped 1,014.79 to 39,593.66, and the Nasdaq composite sank 737.66 to 16,387.31.
“Trump blinks,” UBS strategist Bhanu Baweja wrote in a report about the president’s decision on tariffs, “but the damage isn’t all undone.”
China, meanwhile, has been seeking to join forces with other countries in apparent hopes of forming a united front against Trump. The world’s second-largest economy is also ramping up its own countermeasures to Trump’s tariffs.
The stock price of Warner Bros. Discovery, the company behind “A Minecraft Movie,” dropped 12.5% for one of Wall Street’s sharpest losses after China said Thursday it will “appropriately reduce the number of imported U.S. films.” The Walt Disney Co.’s stock sank 6.8%
A spokesperson for the China Film Administration said it is “inevitable” that Chinese audiences would find American films less palatable given the “wrong move by the U.S. to wantonly implement tariffs on China.”