Asian Markets Open Strong Despite Trade Worries

Asian markets started April on positive ground on Monday, even after China announced fresh tariffs on 128 U.S. products in response to steel and aluminum tariffs out of the United States. China’s new tariffs directly impact the products listed in the country’s original list that was published on March 23, including pork, fresh and dried fruit, nuts and steel pipes. The items now being subject to additional tariffs are valued at an estimated $3 billion and many will be subject to an additional 15 percent tariff. The tariffs will be imposed starting today.

Japan’s Nikkei 225 was up 0.47 percent as of 12:40 p.m. HK/SIN, while Hong Kong’s Hang Seng Index was up 0.24 percent. The Shanghai Composite gained 0.18 and South Korea’s Kospi gained 0.17 percent. Only the ASX 200 bucked the trend, trading down 0.52 percent.

With its announcement on Monday, China publicly suspended its obligations to the World Trade Organization (WTO) to reduce tariffs on 120 U.S. goods. Last week Chinese officials noted their preference to resolve the trade war through dialogue and negotiation, though by Monday, it seems, the escalating trade tensions made such diplomatic avenues impossible.

Dollar Remains Steady

The dollar was trading nearly flat just after noon in Asia, with the dollar index down a modest 0.02 percent to 889.99 .DXY as investors stood to the side in anticipation of economic data expected out both today and later this week. Later on Monday the Institute for Supply Management (ISM) will be releasing the U.S. manufacturing index, and on Wednesday it will be releasing non-manufacturing index numbers. The non-farm payroll report will be released on Friday.

The dollar index closed over 2 percent lower at the end of Q1 2018 last week, its fifth consecutive quarter of losses.

Sara Patterson has a Master’s Degree in political science and enjoys analyzing both current events and the international markets to get a fuller perspective of the currency market. Before turning to financial writing, she taught English writing skills to high-school age students. Sara’s work has been published on various financial and Forex blogs.