Black Monday: Japan market leads Asian rout as China-US trade war intensifies 

Japanese stock market crashed today, leading the 'Black Monday' selloff in Asia, as the China-US trade war intensified and is likely to have serious ramifications for the global economy.  

Japan's Topix and Nikkei 225 fell 7 per cent each, with the Topix Banks index falling as much as 15 per cent, as JP Morgan  predicted a 60 per cent chance of the US and global recession, following Donald Trump's tariffs announcement. Japan’s stock exchange briefly halted trading in Nikkei stock futures earlier today as a circuit breaker kicked in.

South Korean Kospi declined 4.31 per cent to 2,359.07. Australia's S&P/ASX 200 index plunged 4.62 per cent to 7,313.90.  Taiwan stocks in fact nose-dived almost 10 per cent in their first trading since US tariffs. This market was shut on Thursday and Friday. Taiwan's Financial Supervisory Commission recently announced limiting of the number of shares that can be sold short. It also  raised the minimum short-selling margin ratio to 130 per cent from 90 per cent, beginning Monday.

The US President Trump’s reciprocal tariffs is likely to hit Asia the hardest, due to the export-oriented economies in the region. 

China has decided to impose 34 per cent duties on all US imports. It also announced export controls on rare earth minerals, as the tit-for-tat tariffs by the two world's largest economies threaten the globally economic growth.

The recent higher tariffs by the US administration on China increased the threat that these exports will be redirected to the rest of Asia, which is already reeling under China’s overcapacity, analysts warned. 

"The highest tariff rates by the US have been announced for Southeast Asia (32-49 per cent), notably Cambodia, Vietnam and Thailand, suggesting closing of the third country circumvention loophole has played a role," Nomura said. 

"For China, the reciprocal tariffs are due to non-tariff trade barriers, with Trump asserting that China’s non-market policies and practices have led to its dominance in key manufacturing industries, hitting US industries in the process," Nomura noted.   

On Friday, Nasdaq Composite plunged 5.82 per cent on Friday, with Dow Jones and S&P 500 plunging by up to 5.97 per cent, triggering a selloff in Asia today. With this US stocks are down 10 per cent in two sessions.

In the case of domestic market, Nifty is all likely to test 21,500 in the April-June period as the second-order effect of Trump tariffs hurt India more, Emkay Global suggested in a strategy note.

The broking firm anticipated a 3 per cent proforma risk to its Nifty FY26 EPS estimate of Rs 1,160, mainly from technology earnings cuts, given that the consensus was building on for a recovery. "Metals, a large contributor to the FY26 Nifty EPS, is also now vulnerable as new capacity comes on stream and lower prices could hurt," Emkay Global warned.