Asian stocks open in red amid US-China trade war concerns

Asian stocks opened the third session of the week on red, following its US counterpart which witnessed its worst performance this year on Tuesday, amid the markets pricing of the possible next step in trade protectionism among the two largest economies in the wake of the recent threat by the US President, Donald Trump, to raise tariffs on China's imported goods and commodities in nearly $200 billion worth from 10% to 25% starting next Friday.

We have followed the General Administration of Customs' release its reading of China's trade balance index, which showed that the surplus shrank to 94 billion yuan, or 13.8 billion US dollars, compared to 221 billion yuan, or $32.6 billion in March, worse than expected which indicated that the surplus would widen to 235 billion yuan, or $33.7 billion, as export growth slowed and imports rose last month.

Following a decision by monetary policy makers at the Reserve Bank of New Zealand to cut short-term benchmark interest rates by 25 basis points to 1.50% from 1.75% at the Reserve Bank of New Zealand meeting on May 8th, which came in contrast to market analysts' expectations for the 18th consecutive session.

United States Trade Representative, Robert Lighthizer, and Secretary of Treasury, Steven Mnuchin, said on Tuesday that China had moved away from the commitments made during trade negotiations. The top US trade commissioner, Lighthizer, at the time noted that Washington would increase the tariffs on Chinese goods imported to America from 10% to 25% by next Friday.

The US President, Donald Trump, threatened through his official Twitter account to restore tariffs on China's imported goods and commodities. Pointing out that for about nine months customs duties are paid 25% on goods estimated at $50 billion, and customs duties 10% on goods estimated at $200 billion, which contributed to support the US economy.

He also noted that tariffs on China's imported goods and commodities in nearly $200 billion worth could be raised and to raise tariffs by 10% to 25% next Friday. as he also threatened to also impose another 25% in tariffs on imported Chinese goods estimated at $325 billion soon. He said that his country had lost much in trade with the countries, and that the losses were estimated at between $600 to $800 billion a year, and with China losses estimated at $500 billion, adding that more losses would not be accepted.

This comes as the US administration is pressuring China as it paves the way for negotiations aimed at reaching a trade agreement between Washington and Beijing and on the threshold of the Vice Premier of the People's Republic of China, Liu He's visit to Washington on Thursday and Friday for further discussions and trade talks between the two sides, Following the visit of the United States Trade Representative, Robert Lighthizer, and Secretary of Treasury, Steven Mnuchin, to Beijing last week.

Japanese stocks witnessed a fall during today's trading session, with the broader Topix index falling by 1.66% to lose (26.56 point) down to 1,573.28, while Nikkei 225 index also fell by 1.55% (339.46 points) down to 21,584.26.

As for the Chinese stock indices, CSI 300 fell 0.43% to lose 16.18 points and reach 3,704.49, the Shanghai Composite Index also fell 0.43% (12.55 points) to reach 2,913.84.

As for Hong Kong's Hang Sang, it fell 0.64% (187.87 points) to 29,175.15. While South Korea's Kospi Index fell 0.19% (4.06 points) to 2,172.93.

To New Zealand's NZX 50, which fell 0.02% (2.25 points) to 10,025.14. While Australia's S&P/ASX 200 index also fell 0.43% to lose 26.78 points and reached the level of 6,268.90.