Asian markets slide after Trump announces new tariffs on drugs, imports

Asian markets fell on Friday following a surprise announcement by US President Donald Trump to impose sweeping new tariffs, including a 100% import tax on pharmaceutical drugs beginning October 1.

In a post on his social media platform Thursday, Trump accused foreign manufacturers; particularly those producing furniture and cabinetry, of "flooding" the US market. 

He said the new tariffs were necessary for “national security and other reasons,” also mentioning heavy trucks and parts, although most of those are already sourced domestically or from North America.

The tariff announcement sent shockwaves through financial markets across Asia.

Japan’s Nikkei 225 dipped 0.3% to close at 45,629.79, with drugmakers hit hard; Sumitomo Pharma plunged 5.2%, while Chugai Pharmaceutical fell 3.9%. 

South Korea’s Kospi led regional declines, tumbling 2.5% to 3,384.58, extending its losing streak to three sessions amid growing trade concerns.

Hong Kong’s Hang Seng Index dropped 0.7%, while China’s Shanghai Composite edged down 0.1%. 

India’s Sensex also lost 0.7% and Taiwan’s Taiex fell 1.5%. 

One notable exception was Australia’s S&P/ASX 200, which bucked the trend to rise 0.2%.

The tariff news also weighed on US markets, with Wall Street posting its third straight day of losses on Thursday. 

Investors remain cautious amid fears that strong US economic data could reduce the likelihood of multiple interest rate cuts by the Federal Reserve; an expectation that has been a major support for this year’s equity rally.

In commodities, oil prices ticked slightly higher, while the U.S. dollar weakened marginally against the Japanese yen.

SH