BENGALURU- Equities in Vietnam and Thailand plunged even further on Friday as investors fled from risky assets, after US President Donald Trump’s unexpectedly severe tariffs fueled fears of a global recession.
Thailand’s benchmark stock index slumped 2.8 percent to its lowest level in more than five years, bringing its year-to-date losses to about 19.4 percent.
Vietnam stocks tanked as much as 5.8 percent to their lowest level in 15 months, extending their slide after Thursday’s near 7 percent drop.
The selling in Vietnamese shares was fairly uniform across-the-board, indicating that investors would need more time and information to digest the likely impact of the US tariffs on the economy and corporate earnings, said Michael Kokalari, chief economist at VinaCapital.
Trump hit export-driven Southeast Asian nations with some of the heftiest tariffs, with Vietnamese exports getting a 46 percent levy and Thailand 37 percent.
Intense negotiations between Vietnamese and US trade authorities were expected in the weeks ahead, but there is no consensus on what the final tariff might be, Kokalari added.
“Given how high the initial negotiating position is, it is hard to see a final figure of anything less than 25 percent, which would represent a material hit to Vietnam’s GDP growth,” he said in a note.
Other Asian stock markets also fell, with shares in Malaysia and the Philippines down about 1 percent each. The Philippine benchmark index is now down 20 percent from its October 7 peak.
Singapore stocks slumped 2.5 percent and were on course for their biggest one-day percentage drop in eight months.
US imposed 10 percent tariffs on the city-state despite the two countries having a free-trade agreement and Singapore running a bilateral trade deficit with the US
Currencies in the region were broadly higher against the bruised dollar.
The Malaysian ringgit Philippine peso and the Thai baht appreciated between 0.3 percent and 0.5 percent.
