Shares of Chinese electric vehicle (EV) makers listed in Hong Kong fell sharply on Monday, after former U.S. President Donald Trump announced new tariffs on imports, intensifying trade tensions and sparking a broader global market selloff.
BYD dropped 11.15% to HK$333.00, while Nio declined 11.30% to HK$25.50. Xpeng fell 11.40% to HK$72.25 and Li Auto was down 10.82% to HK$86.95 in early Hong Kong trading. The steep losses came alongside broader declines in the market, with the Hang Seng Index sliding 9% and the Hang Seng Tech Index dropping more than 11%.
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The selloff followed Trumpās announcement on April 2 of additional tariffs on all trading partners, including a 34% tariff specifically targeting China. These new measures come on top of a previously imposed 20% tariff earlier this year, bringing the total to 54%.
In response, China said on Friday it would impose retaliatory tariffs of 34% on all U.S. imports starting April 10. The Ministry of Commerce also added 11 U.S. companies to its āunreliable entitiesā list, effectively barring them from operating within China.
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According to a research note by China International Capital Corporation (CICC), the intensifying trade conflict could lead to a reassessment of global market valuations, with geopolitical factors taking a more prominent role.
CICC noted that while new tariffs may pose challenges to Chinaās economy, current market conditions are more favorable than during the 2018-2019 trade friction period, citing stronger domestic fundamentals and potential policy support.