BLACK MONDAY: Taiwan and Japan markets plunge as all signs point to bloody weak ahead

Taipei, Taiwan: Taiwan’s stock market plummeted nearly 10% on Monday in its first trading session since President Donald Trump announced new tariffs last week. Hong Kong stocks have plummeted more than 9% at open

The benchmark index hit its lowest level in over a year, with major companies like chipmaker TSMC and electronics manufacturer Foxconn both falling close to the 10% circuit breaker limit.

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Taiwan’s financial regulator responded by imposing temporary restrictions on short-selling to curb market volatility. Stock exchange chairman Sherman Lin assured investors that further stabilization measures would be introduced if needed, though he acknowledged the difficulty of avoiding broader market impacts.

The sell-off extended to Japan, where the Nikkei 225 index tumbled nearly 9%, reaching its lowest point since October 2023. Banking stocks were hit hardest, plunging as much as 17%, as fears of a tariff-induced global recession intensified. All 225 components of the Nikkei traded in negative territory, while the broader Topix index dropped 8%.

In Australia, more than $160bn has been wiped off the Australian share market. The benchmark S&P/ASX 200 sank more than 6% to trade below the 7200-point mark within 15 minutes after the market opened on Monday.

Meanwhile, US Treasury yields fell sharply as markets priced in expectations of Federal Reserve rate cuts amid rising recession risks. The two-year yield dropped to its lowest level since September 2022, while futures markets indicated a 60% chance of a rate cut by May. JPMorgan increased its recession probability for the U.S. and global economy to 60%, citing weakened business confidence and slowing growth due to trade tensions.