US stocks plunge, Asia surges after Trump's new tax letter

(Dan Tri) - Asian stock markets were green, US stocks fell across the board after US President Donald Trump sent a new reciprocal tax notice to many countries.

Opening the morning session on July 8, Asia- Pacific stock markets were all covered in green, despite the prevailing cautious sentiment after US President Donald Trump announced high tariffs on imported goods from 14 countries, including many major partners in Asia.

According to Reuters statistics, on July 7, US President Donald Trump sent tax notice letters to the leaders of 14 countries including: Tunisia (25%), Indonesia (32%), Bosnia (30%), Bangladesh (35%), Serbia (35%), Cambodia (36%), Thailand (36%), Japan (25%), South Korea (25%), Malaysia (25%), Kazakhstan (25%), South Africa (30%), Laos (40%), Myanmar (40%).

The White House plans to send additional letters to other countries in the coming days.

Asian stock indexes (Source: CNBC).

Several other countries in the Asia- Pacific region are also on the list of countries subject to tax increases, including Indonesia with a special consumption tax rate of 32%, Bangladesh 35%, while Cambodia and Thailand are both subject to a rate of 36%. Notably, imported goods from Laos and Myanmar will face the highest tax rate of up to 40%.

However, regional markets remained in the green, supported by expectations that the tariffs may not last long. In Japan, the Nikkei 225 rose 0.18%, while the Topix was almost flat. In South Korea, the Kospi rose 1.01%, while the Kosdaq was little changed.

In China, the CSI 300 index rose 0.2%, and Hong Kong's Hang Seng edged up 0.18%. Meanwhile, Australia's S&P/ASX 200 index was flat as the market awaited a policy decision from the Reserve Bank of Australia, which is expected to cut interest rates by 25 basis points (0.25%) to 3.6%.

In contrast to the positive developments in Asia, US stocks plunged in the first trading session of the week after Mr. Trump announced a new tariff plan, causing all three major indexes on Wall Street to record their sharpest decline since mid-June.

The Dow Jones Industrial Average fell 422.17 points, or 0.94%, to 44,406.36. The S&P 500 fell 0.79% to 6,229.98, while the Nasdaq Composite dropped 0.92% to close at 20,412.52.

The US market was also under pressure from Tesla CEO Elon Musk’s announcement that he would form a new political party called the “America Party,” which has heightened political tensions with Mr. Trump. Tesla shares plunged 6.8%, their biggest one-day drop since June 5 and their lowest close in more than a month.

Analysts say the new wave of tariffs is making investors cautious again after a series of euphoric sessions. Both the Nasdaq and the S&P 500 hit consecutive record highs last week, helped by positive jobs data.

However, according to Ms. Emily Roland, co-chief investment officer at Manulife John Hancock (Boston), the market is facing the risk of tax policy returning to the center of attention, causing the excitement to subside.

Investors are closely watching the next moves of Mr. Trump, who confirmed that he will announce more new tariffs on July 9 and threatened to impose an additional 10% tax on countries that are considered to support the “anti-American” policy of the BRICS group of Brazil, Russia, India, China and South Africa.

The new wave of taxes also raises concerns that inflation will escalate again, making it difficult for the US Federal Reserve (Fed) to ease monetary policy.

Minutes from the Fed’s June policy meeting, due out on July 9 (US time), will provide further clues on the direction of interest rates in the coming period. According to the CME Group’s FedWatch tool, the probability of the Fed keeping interest rates unchanged in July is currently at 95%, while expectations for a rate cut in September are around 60%.

Volume on US exchanges reached 16.5 billion shares, below the average of the last 20 sessions. Declining stocks on the New York Stock Exchange outnumbered advancing stocks by a ratio of 3.44:1. On Nasdaq, the ratio was 2.74:1.

Of the 11 major sectors in the S&P 500, nine declined, led by consumer discretionary and energy. Defensive sectors such as utilities and consumer staples posted modest gains. A rare bright spot was WNS Holdings, which surged 14.3% after it was acquired by French conglomerate Capgemini for $3.3 billion.

Trump's tough trade policies are casting a shadow over global markets and will continue to be a major unknown for investors in the coming weeks.

Source: https://dantri.com.vn/kinh-doanh/chung-khoan-my-lao-doc-chau-a-tang-vot-sau-thu-ap-thue-moi-cua-ong-trump-20250708091709113.htm