Stocks in China plummeted on Monday following a new escalation between China and the United States, when President Trump announced an imminent increase in customs tariffs for $ 200 billion on Chinese goods.
Chinese markets fell 5%. Japanese yen strengthened, while the Chinese yuan dropped. The Australian dollar has also weakened.
US President Donald Trump threatened other duties on Chinese goods via Twitter on Sunday. Meanwhile, China has considered canceling trade negotiations with the US this week after the latest Trump threats.
The Shanghai composite index fell 5.58%, closing at 2,906.46, while the Shenzhen composite fell 7.56% to close at 8,943.52.
The CSI 300, which tracks the largest listed stocks on the mainland, declined 5.84% to 3,684.62.
In Hong Kong, the Hang Seng index slipped 2.90% to close at 29.209,82.
Hong Kong-listed shares of ZTE, a Chinese telecommunications equipment company, plummeted 8.82%. Its Shenzhen-listed counterpart also fell 9.98%.
The offshore Chinese yuan also declined to 6.7790 against the dollar, from highs of around 6.72 last week.
Trump said in a tweet Sunday afternoon that the current 10% withdrawals on Chinese goods worth of 200 billion will rise to 25% on Friday.
He also threatened to impose 25% tariffs on additional $ 325 billion of “short-term” Chinese goods.
Meanwhile, China is considering canceling trade talks with the United States this week in light of Trump’s latest threats.
Increased tariffs could jeopardize the prospect of a recovery in global growth.