Tariffs are coming next week according to the U.S. President Donald Trump announcement yesterday and the blue chip index Dow Jones plunged 420 points. Automakers and manufacturers took the biggest hit. Trump’s planned tariffs on steel and aluminum can change global trade and cost jobs, with the risk of tit-for-tat measures.
Following a rough night on Wall Street Fears of an escalating trade war, hit the equity prices of Asian steelmakers and manufacturers supplying U.S. markets.
Trump pledged to restore the U.S. industry and punish what he sees as unfair trade practices, particularly by China. US Steel was one of the few stocks to stay in the green, gaining 5.75% on the news that foreign steel would be subject to a 25% import tax. Aluminum will be taxed at a 10% rate.
South Korea, the third-largest steel exporter to the United States after Canada and Brazil, said it will keep talking to U.S. officials until Washington’s plans for tariffs are finalized.
Asian steelmakers fear U.S. tariffs could result in their domestic markets becoming flooded with steel products that have nowhere else to go.
On Friday, stock markets in Asia extended Wall Street’s overnight losses, with investors shocked by the threat of a global trade war after President Donald Trump remarks that the United States would impose heavy tariffs on imported steel and aluminum.