US Tariff Shock Causes Singapore's Benchmark Index to Plummet, Tokyo Markets Also Suffer
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Synopsis
US tariff measures have caused significant market turmoil, leading to an 8.7% drop in Singapore's Straits Times Index. The decline marks the steepest drop since 2008, while Tokyo markets also experienced significant losses amid fears of a trade war.
Key Takeaways
- 8.7 percent drop in Singapore's STI
- Steepest decline since 2008
- Potential for inflation and slower growth
- US tariffs could lead to global market volatility
- Tokyo's Nikkei index faced historic losses
Singapore, April 7 (NationPress) Market instability caused by newly implemented US tariff policies continued to reverberate across global equity markets on Monday, leading to the Straits Times Index (STI) of Singapore dropping by 8.7 percent at the open, settling at 3,494.39 points.
This significant decline represents the STI's deepest single-day drop since an 8.9 percent fall during the global financial crisis of 2008, surpassing the 8.4 percent decrease recorded in March 2020 amid the Covid-19 pandemic.
David Gerald, President of the Securities Investors Association (Singapore), noted, "If these tariffs persist, they could lead to increased inflation and sluggish global growth, potentially sparking further market volatility and sell-offs worldwide, including in Singapore," as reported by The Straits Times and Xinhua news agency.
The association highlighted in a report on Monday that Singapore's equity market remained relatively robust in recent weeks despite tariff anxieties, but ultimately succumbed to widespread selling last Friday. This was triggered by disappointing tariff announcements from the Trump administration, which many fear could push the global economy into recession.
On Wednesday, Trump enacted an executive order establishing a 10-percent "minimum baseline tariff" on all imports, including those from Singapore, with higher tariffs aimed at particular trading partners.
Concurrently, Tokyo markets also experienced a steep decline on Monday, with the benchmark Nikkei index suffering its third-largest point drop in history, as global sell-offs persisted amidst escalating fears of an all-out trade war and a potential global economic recession spurred by the uptick in US tariffs.
The Nikkei stock index, comprising 225 issues, ended down 2,644.00 points, or 7.83 percent, closing at 31,136.58.
The broader Topix index also finished 193.40 points, or 7.79 percent, lower at 2,288.66.
Early Monday, Tokyo stocks fell sharply, with the Nikkei index briefly losing nearly 3,000 points amid rising concerns over a global trade dispute ignited by US tariffs.
In the first 15 minutes of trading, Japan's Nikkei stock index shed 2,843.48 points, or 8.42 percent, from Friday, reaching 30,937.10, the lowest intraday level since October 2023.
