FX.co ★ China Stocks Plunge as Trade War Escalates

On Monday, the Shanghai Composite Index plummeted by 7.34%, settling at 3,097, while the Shenzhen Component experienced an even sharper decline of 9.66%, closing at 9,364. This downturn in mainland stocks followed a global market selloff fuelled by escalating trade tensions as US President Donald Trump intensified the trade war, raising concerns of a potential global recession. After the US increased tariffs on Chinese goods to 54% last week, China retaliated on Friday with a 34% tariff on all US imports, opting for a hard-line stance rather than negotiation. President Trump further stated on Sunday that the US would continue with its tariff strategy unless the trade imbalance with China is addressed. Investors are now closely monitoring Beijing for potential policy responses, such as monetary easing, to support the economy. All market sectors suffered declines, with significant losses recorded by major players including Contemporary Amperex (-11.5%), East Money (-13.9%), BYD Company (-10%), Kweichow Moutai (-4.4%), and Zijin Mining (-9.9%).