China and Hong stocks opened sharply lower on Friday, after Beijing announced plans for tariffs on US imports in retaliation to protectionist measures by the United States, stoking fears of a global trade war. The world’s second-largest economy has unveiled plans to levy duties on up to $3 billion of US imports in response to US tariffs on Chinese steel and aluminium products, which will go into effect on Friday.
China also urged the United States to “pull back from the brink” after US President Donald Trump signed a presidential memorandum on Thursday that could impose tariffs on up to $60 billion of imports from China, although the measures have a 30-day consultation period. Worries about how a trade war could erode global growth put investors on edge, dragging down financial markets across the board, with the exception of perceived havens such as government bonds and the yen.
At 0131 GMT, the Shanghai Composite index was down 110.02 points or 3.37 percent at 3,153.46, while China’s blue-chip CSI300 index was down 3.72 percent. Both indexes were set for their worst day since early February.
In Hong Kong, the benchmark Hang Seng Index fell 3.38 percent at 12,007.38, while the Hang Seng Index was down 3.43 percent at 30,005.44. The slump in Hong Kong was led by Tencent, which fell more than 5 percent after Naspers Ltd’s plan to cut its stake in the Chinese internet giant.