Hong Kong Stocks Plunge as Global Tariff War Escalates
Market Reaction to Tariff War
The latest escalation in the tariff war between China and the US has sent shockwaves across Asia-Pacific stock markets. Hong Kong’s Hang Seng Index suffered a staggering 10.7% decline, marking its biggest intraday drop since the 2008 financial crisis.
Impact on Major Indices
- The **CSI 300 Index**, tracking the 300 largest stocks in Shanghai and Shenzhen, fell by 7.6%.
- The **Shanghai Composite Index** and the **Shenzhen Composite Index** dropped 7.4% and 9.8%, respectively.
- In Japan, the **Nikkei 225** slid 6.2%, while South Korea’s **Kospi Index** retreated 4.7%.
Sector Analysis
All 14 major equity gauges in the region tumbled, with technology and e-commerce stocks bearing the heaviest losses. Notable declines included:
- Alibaba down 14.4%
- JD.com down 15.6%
- Xiaomi down 15.3%
As the **tariff threat** looms, experts warn of further declines in market sentiment. Patrick Pan and Yue Tan from Daiwa Capital Markets predict ongoing volatility.
Strategic Recommendations
Investment firm **Goldman Sachs** revised its growth estimates for Chinese equities, urging investors to avoid trade-dependent sectors and focus on more stable areas such as healthcare and utilities. This strategic pivot may shield investors from the ongoing turmoil.
As tensions escalate, traders are on high alert, awaiting potential changes in market dynamics.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.