SHANGHAI, CHINA – AUGUST 14, 2025 – Tourists are visiting the Bund in Shanghai, China on August 14, 2025.
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Asia-Pacific markets fell Monday after China and the U.S. tightened trade restrictions and traded fresh accusations, renewing tensions between the world’s two largest economies.
Hong Kong’s Hang Seng index declined 2.04%, while mainland China’s CSI 300 closed 0.5% lower at 4,593.98.
The offshore Chinese yuan strengthened 0.1% to 7.1267 against the greenback. The 10-year China government bond yield lost more than 5 basis points to 1.752%.
China on Sunday said “we are not afraid of” a trade war with the United States after President Donald Trump vowed to impose punishing new retaliatory tariffs on Chinese imports.
Chinese stocks will be hit this week, but will resume its uptrend after a correction, said Hao Hong, managing partner and CIO of Lotus Asset Management.
“It’s a good spot to build positions if people missed the rally earlier this year,” he told CNBC. “We believe Chinese stocks are still cheap and many are still not fully invested. There’s plenty of money on the sideline and people should put the idle money to work.”
A spokesperson for China’s Ministry of Commerce accused the U.S. of a “textbook double standard” with Trump’s promise on Friday to tack on additional 100% tariffs on those imports after China imposed new export controls on rare earths minerals.
The recent policy announcements may signal that China intends to push for greater concessions from the U.S., Goldman Sachs wrote in a note Sunday.
China’s exports climbed at the fastest pace in six months in September, while imports logged their strongest gain in more than a year, even as a trade deal with the U.S. remains elusive.
Exports grew 8.3% in September in U.S. dollar terms from a year earlier, China’s customs data showed Monday, beating Reuters-polled economists’ estimates for a 7.1% rise and rebounding from August’s six-month low.
Australia’s ASX/S&P 200 lost 0.84% to 8,882.80. South Korea’s Kospi closed 0.72% lower at 3,584.55, and the small-cap Kosdaq added 0.12% to 860.49.
Singapore’s benchmark index fell as much as 1.18%. India’s Nifty 50 lost 0.29%. Shares of Tata Capital rose 1.37% in its trading debut on the National Stock Exchange and BSE, following a ₹155.1 billion ($1.75 billion) initial public offering.
Japan markets are closed for the holidays.
In a Truth Social post on Sunday, Trump suggested to investors the president may not follow through on his threat to post a “massive increase of tariffs” on China.
That comment on Friday brought the U.S. trade war with China back to the fore, and sent stocks tumbling in a rout that wiped out $2 trillion in market value.
“Don’t worry about China, it will all be fine! Highly respected President Xi just had a bad moment. He doesn’t want Depression for his country, and neither do I,” Trump wrote. “The U.S.A. wants to help China, not hurt it.”
On Friday stateside, the three U.S. major averages declined.
Stocks accelerated selling into the close, with the Dow Jones Industrial Average closing down 878.82 points, or 1.9%, at 45,479.60. The S&P 500 lost 2.71% to settle at 6,552.51, while the Nasdaq Composite fell 3.56% to 22,204.43. The broad-based index’s decline was the largest since April 10.
—CNBC’s Victor Loh and Anniek Bao contributed to this report.