The ASX tumbled following a brutal session on Wall Street where the benchmark S&P500 fell 2.5% on fears the Trump administration is pushing the global economy into a trade war.
The ASX200 slumped below 5900 at the open and kept falling. At the close, the index was at 5,820.70, down 116.50 points or 1.96%.
The Nikkei 225 fell just over 3% when markets opened in Tokyo.
Resources companies were smashed, with BHP, the world’s biggest mining company, down almost 3.1% to $28.77 and Rio Tinto 4.3% to $73.44.
All the big four banks were hit. The Commonwealth shed 2.7% to $72.81 and Westpac 2.5% to $28.85.
Demand for bonds saw benchmark US 10-year bond yields fell by 8 basis points overnight to around 2.8%, while money also flowed into the safe-haven Japanese yen.
Bluescope Steel was down 5.8% to $14.78.
Among retailers, department store Myer fell 10.1% to $0.355 and JB Hi-Fi 2.4% to $25.59.
US President Donald Trump signed a memorandum overnight that could impose tariffs on up to $US60 billion of Chinese imports.
The Dow Jones index closed 2.9% lower and the tech-heavy Nasdaq fell by 1.8%.
“Stocks were pulverised and industrial commodities sank on the announcement of US tariff barriers aimed at China,” said CMC Markets chief market strategist Michael McCarthy in a note ahead of the start of trade. “China’s response was swift and uncharacteristically blunt, and investors rushed for safety, driving bonds and gold higher. While the sanctions may later prove a negotiating tactic the impact on Asia Pacific markets today will be dramatic.”
Nick Twidale, COO at Rakuten Securities Australia, said: “Further uncertainty and increased tensions will only lead to further downside to the stock markets and to risk appetite.”
Here’s the chart showing the close:
NOW WATCH: Money & Markets videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.