Investing.com - Asian stocks were mixed in morning trade on Tuesday following the announcement by the Trump administration that the U.S. would put 10% tariffs on $200 billion in Chinese goods, which will go up to 25% at the end of the year.
China’s Shanghai Composite was down 0.2% by 9:40PM ET (01:40 GMT), while the SZSE Component gained 0.4%. Beijing has earlier threatened to retaliate against such new duties. Hong Kong’s Hang Seng Index on the other hand slid 1.2%.
Trump, in a statement, said that the tariffs would rise to 25% in January 2019, adding that "if China takes retaliatory action against our farmers or other industries, we will immediately pursue phase three, which is tariffs on approximately $267 billion of additional imports."
"We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly," Trump said in the statement.
"But, so far, China has been unwilling to change its practices."
According to reports, the U.S. removed about 300 goods from a previously proposed list of affected products, including smart watches, some chemicals, along with some other products.
Markets are now likely to shift focus towards Beijing’s response to the development, according to analysts.
“China may be limited in its ability to impose similar tariffs in volume terms, but it can still aim to disrupt the US supply chain with those tech exports an obvious target and the cancelation of trade talks is also likely to dampen the mood,” Rodrigo Catril, a senior foreign-exchange strategist at the National Australia Bank, wrote in a morning note.
Elsewhere, Japan’s Nikkei 225 resumed trading after being closed Monday for a public holiday, and traded 0.8% higher.
Meanwhile, South Korea’s KOSPI was little changed at 2302.0 as the country’s President Moon Jae-in headed to Pyongyang on Tuesday for a landmark visit to rescue stalled nuclear talks between the U.S. and North Korea.
Leaders from South and North Korea would feature a joint press appearance on Wednesday, reports suggested.
“I will have candid talks with North Korean leader Kim Jong Un to find common ground between the U.S. demand to denuclearize and the North Korean demand to end their hostile relations,” Moon said at a meeting on Monday. “What I am trying to achieve is peace. Not a temporary change that can be swayed by international conditions, but an irreversible and permanent peace.”