Asian markets slid on Tuesday following a sharp sell-off on Wall Street. The sell-off was triggered by fears of a recession in the US and the impact of President Donald Trump’s tariffs on global trade. In Japan, the Nikkei 225 index plunged nearly 3% in morning trading but recovered some losses to close 0.6% lower.
South Korea’s KOSPI and Taiwan’s TAIEX also saw significant drops before closing 1.3% and 1.7% lower, respectively. Technology shares were hit particularly hard in the region. Japanese tech giants Sony and Hitachi closed over 5% lower, while Taiwan Semiconductor Manufacturing Company and Apple supplier Foxconn ended the day down more than 3%.
European markets were more stable, with Germany’s DAX and France’s CAC indexes posting modest gains. However, US stock futures pointed to a potential rebound, with the Dow, S&P 500, and NASDAQ futures all ticking up in pre-market trading.
asian markets slide on recession fears
The market turbulence comes amid growing concerns over the US economic outlook and the effects of Trump’s trade policies. Last week, the president doubled tariffs on all Chinese imports to 20%, prompting retaliatory measures from China. Trump’s comments on Sunday, meant to allay fears of a recession, appeared to have the opposite effect on investors.
When asked about the possibility of a recession this year, he said, “I hate to predict things like that,” but mentioned a “period of transition” was expected. Nigel Green, CEO of financial consultancy deVere Group, warned that US markets could be heading for a correction after outpacing the rest of the world over the past year. “The warning signs are stacking up.
Consumer sentiment is slipping, inflation remains persistent, and initial jobless claims are climbing,” he said. The sell-off on Monday saw the Dow, S&P 500, and Nasdaq post their worst day of the year, erasing all gains made since Trump’s election victory last year. Delta Air Lines added to the uncertainty by slashing its outlook, citing softer demand due to increasing economic worries.