Asian stocks and the Chinese yuan took a beating Friday after US President Donald Trump announced another round of tariffs on China.
Suppliers of the Chinese tech company Huawei were hit particularly hard after Trump reignited his country’s trade war with China by saying he would add a 10% tariff on $300 billion worth of Chinese-made products in September — effectively taxing all goods from China that come into the United States.
Smartphone component manufacturer Sunny Optical Technology plummeted 6%, while AAC Technologies also tumbled 5%. Q Technology lost 8%, and BYD Electronic sank 7.9%.
All of those stocks are listed on Hong Kong’s Hang Seng (HSI) Index, which fell 2.4% by noon on Friday.
The Shanghai Composite Index, meanwhile, declined 1.7%.
The Chinese yuan tumbled against the dollar, both in Shanghai and in the offshore market where it moves more freely.
In trading outside of China, one US dollar now buys about 6.9606 yuan. Earlier Friday, the yuan fell to as low as 6.9786 — the weakest this year.
In mainland China, where the yuan fluctuates around a reference rate set daily by the People’s Bank of China, the currency stands at 6.9355 to the dollar.
Trump’s announcement — made in a series of tweets overnight — came just after US trade representatives returned from a round of negotiations in Shanghai. While both sides agreed those talks were “constructive,” they announced no tangible progress.
China slammed Trump’s tariff news Friday.
Adding tariffs “is not a constructive way to resolve the trade dispute, it’s not the correct way,” Foreign Minister Wang Yi said in response to a question shouted by local government-run station Shenzen TV. Wang was attending a meeting in Bangkok, Thailand.
Earlier this week, the US-China trade talks ended in Shanghai with little sign of progress. Even so, both sides said discussions were “constructive” and agreed to meet in September.
Rare earth stocks in Asia soared Friday — one of the market’s few winners. Beijing has previously implied that it might halt exports of rare earth elements to the United States as its next bargaining chip in the trade war. China controls more than 90% of rare earths production, which is key to the production of smartphones and tablets, according to the US Geological Survey.
And China’s new Nasdaq-style board in Shanghai rallied. All 25 of those stocks rose by early afternoon.
“Markets are reeling after President Trump expressed his frustration with China’s stalling techniques,” wrote Stephen Innes, managing partner for Vanguard Markets Pte in Singapore, in a research note Friday.
Here are some of the other big moves on Asian markets at 1:00 p.m. Hong Kong time.
- Stocks across the region were down. Japan’s Nikkei fell 2.6%. Taiwan’s Taiex lost 1.4%. Australia’s S&P/ASX 200 fell 0.4%.
- South Korea’s Kospi dropped 0.9%. The index also ended lower Thursday, and has been weighed down by trade tensions. Japan decided Friday to remove South Korea from its so-called white list of trusted trade partners.
- Toyota, Japan’s largest car maker, declined 2.8%. The company reported an 8.7% rise in operating profit for the first quarter, but lowered its profit forecast for the full year because of a stronger yen.
- Oil began to recoup some of the losses incurred after Trump’s tariff announcement. US oil futures rose 2%, while Brent crude, the global benchmark, increased 2.5%.
- Wall Street sold off Thursday following Trump’s tweets. The Dow closed down 1.1%, while the S&P 500 finished down 0.9% and the Nasdaq dropped 0.8%.
CNN Business’ Anneken Tappe contributed to this report.