By: Monu Kumar
Investor concerns about the potential economic slowdown, exacerbated after President Donald Trump in an interview talked about a - period of transition. These comments and worries sapped risk sentiment, sending stocks sliding and weighing on the U.S. dollar and Treasury yields. It saw Asian stocks fell sharply on Tuesday as a market selloff extended on mounting worries that a wide-ranging trade war.
As per experts this could dent U.S. economic growth and lead to a recession, though Trump declined to predict whether his tariffs would result in a U.S. recession.
In Asia, stocks were battered across the board with Chinese stocks and the blue-chip index sliding 0.5%, while Hong Kong’s Hang Seng Index fell by 0.8%.
Even Japan’s Nikkei and Taiwan stocks fell by about 3%, hitting their lowest level since September. Australia’s benchmark index was 0.8% lower having touched a seven-month low earlier in the day.
Asian markets seemingly took cues from Wall Street where the S&P 500 fell 2.7% on Monday, its biggest one-day drop this year, while the Nasdaq slid 4.0%, its biggest single-day percentage drop since September 2022.
Fears of an economic downturn have driven a stock market selloff that has wiped out $4 trillion from the S&P 500’s peak last month. The yield on benchmark U.S. 10-year notes fell 5 basis points in Asian hours on Tuesday after dropping 10 bps in the previous session, the largest daily drop in almost a month.
Safe havens were in demand, with the Japanese yen touching a five-month high against the dollar and was last at 147.07 per dollar. The yen is up 7% against the dollar in 2025. The Swiss franc was hovering near the 3-month high touched on Monday. It was last at 0.8791 per dollar on Tuesday.
The dollar index, which measures the U.S. currency against six other units, was huddled near a four-month low. The index has dropped over 4% so far this year.