Trump’s tariffs announcement lead ASX to lose nearly $50bn

Nearly $50bn was wiped off the Australian sharemarket on Monday as fears of a trade war led by US President Donald Trump tariffs ripped through the local market.

Australia’s sharemarket was dealt a $50bn on Monday after US President Donald Trump moved on his tariff plans faster than the market was anticipating.

The benchmark ASX200 index was smashed 152.9 points or 1.79 per cent to 8379.4 points, having dropped by 2.3 per cent during the earlier parts of Monday’s trading.

The broader All Ordinaries fell 161.30 points or 1.84 per cent to 8628.40 points.

The fallout from President Trump’s tariff announcement wiped about $50bn from the Aussie sharemarket’s value.

The Australian dollar recovered during trading, although still fell 0.40 per cent to 61.19 US cents.

All 11 sectors were trading in the red as the US announced 25 per cent tariffs on Canada and Mexico and a 10 per cent tariff on China. Canada immediately retaliated, while Mexico was considering its options.

The ASX was hammered on Monday as investors factored in US President Donald Trump’s announcement of tariffs on Canada, Mexico and China. (Photo by Jim Watson/ Pool / AFP)

IG market analyst Tony Sycamore said Monday’s market sell-off was appropriate following the announcement of mass tariffs overnight.

“Today was the day the bubble burst if you like. The announcement on the weekend was more hawkish than expected with hopes of delay from when the tariffs were announced and when they were implemented,” he said.

A broad sell-off hit the ASX in early trading as traders digested the impact of the tariff for Australian exports.

Commonwealth Bank was dragged down 1.51 per cent to $158.13, while ANZ fell 1.37 per cent to $30.20. NAB was the most heavily sold off bank, down 2.29 per cent to $39.22 while Westpac traded went down 1.69 per cent to $33.16.

The big miners were also hit as markets feared a global trade war could be a negative for commodity prices.

BHP fell 1.78 per cent to $39.24, while Rio Tinto is also down 2.12 per cent to $114.91. Fortescue was hammered, tumbling 4.39 per cent to $18.29.

After soaring to a record high of 8566.9 points last week in a strong January when lower than expected inflation data fuelled expectations of interest rate cuts, the S & P/ASX 200 quickly gave back its gains, hitting a two-week low.

All 11 sectors traded down, including the major banks and miners. Picture: NewsWire / Jeremy Piper

“A good January doesn’t necessarily mean a good February although it points to a positive year overall. But it is starting to feel like a rerun of 2023 where the market fell 9 per cent after a positive January,” he said.

“I don’t think today’s sell-off is overdone, as I suspect the 10 per cent tariffs on China is the starting point not the ending point, with China being the most important aspect for the Australian market.”

Online luxury retailer Cettire and healthcare conglomerate Fisher Paykel recorded heavy losses, after both said they would be impacted heavily by Trump’s tariffs.

Cettire tumbled 19 per cent to $1.1, while Fisher Paykel fell 7.42 per cent to $31.80.

Magellan also continued its march down, falling another 9.71 per cent to $9.49, after announcing senior leadership changes last week.

There were few companies trading in the green, but Lynas Rare Earths was the best performing share on the ASX after it was revealed the Gina Rinehart-controlled Hancock Prospecting had increased its shareholding in the company. Shares rose 3.63 per cent to $6.56.

Originally published as Trump’s tariffs announcement lead ASX to lose nearly $50bn