Stocks drop

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    SHANGHAI- Asian shares tumbled after US President Donald Trump stunned markets with tariffs against imports from Brazil and Argentina, recharging fears about global trade tensions, while weak US factory data added to the investor gloom.

    MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.37 percent, with Australian shares dropping more than 2 percent, on track for their worst day in two months.

    China’s blue-chip CSI300 index fell as much as 0.62 percent before clawing back to end the morning session flat. Japan’s Nikkei shed 0.61 percent.

    In tweets on Monday, Trump said he would impose tariffs on steel and aluminum imports from Brazil and Argentina, attacking what he saw as both countries’ “massive devaluation of their currencies.”

    Contrary to his remarks, both Brazil and Argentina have been trying to strengthen their respective currencies against the dollar.

    Steven Daghlian, market analyst at CommSec in Sydney, said while the South American tariffs dominated market worries on Tuesday, China’s response to US supporting for anti-government protesters in Hong Kong has also chilled sentiment.

    “Markets are extremely sensitive to any good or bad news on the US-China dispute front, but also the US relationship with other nations as well,” he said.

    China said on Monday US military ships and aircraft won’t be allowed to visit Hong Kong, and also announced sanctions against several US non-government organizations for encouraging protesters to “engage in extremist, violent and criminal acts.”

    Worsening the mood, data from the Institute for Supply Management (ISM) showed the US manufacturing sector contracted for a fourth straight month in November as new orders slid.

    That erased the market cheer from upbeat Chinese factory surveys released over the past few days.

    While trade war headlines have been a key driver of markets in recent weeks, sentiment has broadly held up. The US S&P 500 index, the Dow Jones Industrial Average, the Nasdaq Composite and Australia’s S&P/ASX 200 index all touched record highs last week. – Reuters