Source: Sharecast
Trump said the measure would help “further secure the steel industry”, prompting concerns of renewed trade tensions.
“Several key developments emerged over the weekend ... president Trump announced plans to increase steel and aluminium tariffs to 50%,” said TickMill market strategy partner Patrick Munnelly.
“He accused China of violating their recent agreement, prompting a strong response from China, which suggested it would take ‘forceful measures’.
“Bessent believes the issue will be resolved shortly and assured that the US ‘is never going to default’, as concerns about the debt ceiling rise, highlighted by a Financial Times article discussing the disconnect between the US dollar and Treasury yields.”
Munnelly noted that China's composite PMI for May remained stable, slightly increasing to 50.4 from 50.2 in April.
“Fed's Waller sees potential for ‘positive rate cuts later this year’ if lower tariffs occur, but markets await Powell's comments today at 1800 BST.
“In the Sunday Times, BoE deputy governor Breeden expressed a dovish stance, noting that ‘waves of disinflation are continuing’.
“Overall, the week begins with a risk-off sentiment as gold prices rise, while Asian equities and US futures decline due to the trade tensions mentioned above.”
Most markets fall on Trump’s steel tariff surprise
Japan's Nikkei 225 fell 1.3% to 37,470.67, weighed down by losses in industrials and tech.
Sumco Corporation, Dainippon Screen Manufacturing and Bridgestone each dropped over 4%.
The broader Topix index declined 0.87%.
Hong Kong’s Hang Seng Index slipped 0.57% to 23,157.97.
Property developer Longfor Properties sank more than 5%, while CSPC Pharmaceutical Group and New Oriental Education also posted steep declines.
South Korea’s Kospi 100 bucked the trend, edging up 0.08% to 2,687.00.
Gains were driven by strong performances from game developers NCsoft and Netmarble, which rose 9.18% and 7.83%, respectively.
Hyundai Heavy Industries added 5.55%.
Australia’s S&P/ASX 200 dropped 0.24% to 8,414.10.
Mining and tech stocks dragged the index lower, with Mineral Resources plunging nearly 12% and Appen falling 8.75%.
Markets in China and New Zealand were closed for public holidays.
Currency markets reflected risk aversion, with the dollar last down 0.8% on the yen, trading at JPY 142.87.
The greenback also lost ground against its antipodean counterparts, falling 0.75% and 0.91% on the Aussie and Kiwi, to AUD 1.5433 and NZD 1.6617, respectively.
Oil prices advanced, with Brent crude futures last up 2.88% on ICE at $64.59 per barrel, and the NYMEX quote for West Texas Intermediate rising 3.32% to $62.81.
Manufacturing data paints mixed picture across region
In economic news, manufacturing data released Monday painted a mixed picture for Asia-Pacific economies, with signs of tentative improvement in Japan, persistent weakness in South Korea, and a modest slowdown in Australia.
Japan’s factory activity shrank for an 11th consecutive month in May, but at the slowest pace since December.
The final au Jibun Bank manufacturing PMI rose to 49.4 from 48.7 in April, indicating a milder contraction and hinting at gradual stabilisation in the sector.
In contrast, South Korea’s manufacturing output fell at its fastest rate in over two and a half years, as firms contended with subdued domestic demand and external pressures, including trade tensions.
The S&P Global PMI for May came in at 47.7, up slightly from April’s 47.5, but still firmly in contraction territory for a fourth straight month.
Australia’s manufacturing sector remained in expansion, though growth softened.
The country's S&P Global manufacturing PMI slipped to 51 in May from 51.7 in April, with production levels dipping for the first time in three months.
While export demand showed improvement, the pace of new orders slowed, tempering overall sector momentum.
Reporting by Josh White for Sharecast.com.