China stocks on course for worst single-day crash since 2008 crisis

ANI April 7, 2025 160 views

The Chinese stock market experienced a dramatic nosedive following escalating trade tensions between the United States and China. President Trump's imposition of 34% duties on Chinese goods triggered a retaliatory response from Beijing, causing significant market instability. Major tech companies like Alibaba and Tencent saw substantial stock declines, reflecting the broader economic uncertainty. Market analysts warn of continued volatility as the trade dispute between the world's two largest economies intensifies.

"Globally, markets are going through heightened volatility caused by extreme uncertainty" - V K Vijayakumar, Geojit Financial Services
New Delhi, April 7: Chinese stocks nosedived sharply on Monday after Beijing slapped back at the US with retaliatory tariffs, sparking fears of a persistent trade war between two major economies.

Key Points

1

China retaliates with 34% tariffs on US goods

2

Alibaba and Tencent stocks tumble over 10%

3

Hang Seng Index experiences largest fall since 2008 crisis

At the time of filing this report, the Hang Seng Index was about 12 percent lower, and the Shanghai Composite Index was about 8 percent lower. If sustained, these would make for the benchmark's largest daily fall since the 2008 global financial crisis, according to reports.

According to a Reuters report, shares in online giants Alibaba and Tencent were down more than 10 percent.

Hong Kong-listed shares of HSBC tumbled 13 per cent to head for their largest daily fall since 2009, and Standard Chartered stock was down more than 16 per cent, on course for a record fall, per the Reuters report.

As part of the reciprocal tariffs announcement, US President Donald Trump imposed 34 per cent duties on Chinese goods. Faced with the tariffs, China retaliated with a similar degree of tariffs on US goods, setting off a potential trade war, and dampening investors' sentiment for the time being.

"China struck back at the U.S tariffs imposed by Trump with a slew of counter-measures including extra levies of 34 per cent on all U.S. goods and export curbs on some rare-earths, deepening the trade war between the world's two biggest economies," said Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial services Ltd.

Since assuming office for his second term, President Trump has reiterated his stance on tariff reciprocity, emphasising that the United States will match tariffs imposed by other countries, including China, to ensure fair trade.

On April 2, the US President issued an executive order on reciprocal tariffs, imposing additional ad valorem duties ranging from 10 per cent to 50 per cent on imports from all trading partners. The baseline duty of 10 per cent will be effective from April 05, 2025, and the remaining country-specific additional ad valorem duty will be effective from April 09, 2025.

"Globally, markets are going through heightened volatility caused by extreme uncertainty. No one has a clue about how this turbulence caused by Trump tariffs will evolve," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Reader Comments

J
James K.
This is exactly why I've been diversifying my portfolio globally. When two economic giants clash, everyone gets hurt. Stay safe out there investors! 💸
S
Sarah L.
The article could have explained more about how this affects regular consumers. Higher tariffs usually mean higher prices for everyday goods, right?
M
Michael T.
Wow, 16% drop for Standard Chartered! That's insane. I remember buying their shares after the 2008 crisis. History repeating itself?
A
Amanda P.
As someone who works in international trade, this is really concerning. These tit-for-tat tariffs never end well. Hope cooler heads prevail soon. 🤞
R
Rajiv M.
Interesting that rare earth metals are part of China's countermeasures. They control like 80% of global supply - that could hurt US tech companies bad.
L
Lisa W.
While the article covers the immediate market impact well, I wish it had more analysis on potential long-term consequences beyond just the stock drops.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Tags:
China Stocks US-China Trade War Trump Tariffs Stock Market Crash Global Economy
You May Like!