Market turmoil extended into Wednesday, as stocks across Asia faced renewed pressure from significantly higher taxes on imports to the United States.
Stocks slumped across Asia, following a day on Wall Street when stocks whipsawed. Taiwan was the worst hit, sinking over 6 percent. Shares in Japan were down 4 percent. The declines were between 1.5 and 2 percent in South Korea and Hong Kong. Stocks in mainland China were slightly higher.
President Trump uprooted investors last week with the announcement of tariffs on countries across the world. Significantly higher American import taxes on goods from dozens of other countries took effect on Wednesday.
On Tuesday, the S&P 500 ended near a bear market, which is a 20 percent drop from a recent peak — a symbolic, and relatively rare and worrisome, threshold for investors. It closed 18.9 percent below its mid-February record, having plunged more than 12 percent just in the days since Mr. Trump announced his new tariffs.
S&P 500 futures, which let investors bet on the direction of the index when it resumes trading in New York, were about 2 percent lower.
Administration officials appeared to leave the door open for negotiations that could ultimately defuse the trade war, citing the fact that dozens of countries had approached the U.S. government in recent days to strike deals. But White House officials have sought to set a high bar for what the president is willing to accept, marking a shift in tone after Mr. Trump and his aides initially signaled they would not haggle over tariffs at all.
“If they come to us with really great deals that advantage American manufacturing and American farmers, I’m sure he’ll listen,” Kevin Hassett, the director of the White House National Economic Council, said in an interview on Fox News.
But, he added, “after decades and decades of mistreating American workers, it’s going to be tough to get him to decide to really come to the table and sign on the dotted line.”
Since Mr. Trump’s announcement last week of new tariffs, including a base tax of 10 percent on virtually all American imports, countries have responded with tariffs of their own on U.S. goods, or with threats of retaliation.
China, the world’s second-largest economy, retaliated with 34 percent tariffs on American goods that are set to take effect at noon Eastern time on Wednesday.
Earlier this week, Japan emerged as the first major economy to secure priority tariff negotiations with the Trump administration. The news triggered a brief surge in Tokyo-listed stocks before they resumed their decline on Wednesday.