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Asian Markets Slip as Wall Street Selloff Deepens on Trump Tariff Uncertainty and AI Fears

Asian Markets Slip as Wall Street Selloff Deepens on Trump Tariff Uncertainty and AI Fears. Source: Photo by Kindel Media

Asian stock markets edged lower in early Tuesday trading after a sharp selloff on Wall Street rattled global investor sentiment. Heightened uncertainty surrounding U.S. President Donald Trump’s tariff policy and rising geopolitical tensions weighed heavily on risk appetite across the Asia-Pacific region.

MSCI’s broadest index of Asia-Pacific shares outside Japan reversed earlier gains, falling 0.2% after a six-session rally, with South Korean stocks leading regional declines. Japan’s Nikkei 225, however, climbed 0.7% as markets reopened following a public holiday. Meanwhile, S&P 500 e-mini futures ticked up 0.1%, signaling a cautious start for U.S. equities.

Investor concerns intensified after Trump warned trading partners against retreating from recently negotiated agreements. His comments followed a U.S. Supreme Court decision to strike down emergency tariffs, prompting plans for new duties under Section 122 of the Trade Act of 1974. The policy shift has fueled confusion in financial markets already grappling with protectionist trade measures.

On Monday, the S&P 500 dropped 1%, erasing last week’s gains, while the Nasdaq Composite slid 1.1% amid growing fears about artificial intelligence disrupting software and other sectors. A bearish outlook from Citrini Research further pressured sentiment. The CBOE Volatility Index (VIX), a key measure of market fear, jumped to 21.01.

In currency markets, the U.S. dollar strengthened 0.1% against the Japanese yen to 154.77, while the offshore Chinese yuan held steady at 6.889 per dollar. Fed funds futures indicate a 95.5% probability that the Federal Reserve will keep interest rates unchanged at its March 18 meeting. The U.S. 10-year Treasury yield edged up to 4.029%.

Commodity prices reflected ongoing uncertainty. WTI crude oil dipped 0.1% to $66.23 amid U.S.-Iran tensions and security concerns in Lebanon. Gold, a traditional safe-haven asset, rose 0.3% to $5,244.96, while silver slipped slightly. In cryptocurrency markets, Bitcoin gained 0.4% to $64,832, while Ethereum eased 0.1% to $1,861.

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