Here are the winners and losers in Asia from Trump’s tariffs

Singapore – Asian stocks reliant on exports, ranging from Japanese carmakers to Chinese e-commerce firms, nosedived after US President Donald Trump unleashed his first wave of tariffs, signalling the beginning of a new round of global trade war.

On Feb 1, Mr Trump ordered general tariffs of 25 per cent on Canada and Mexico and 10 per cent on China to come into effect on Feb 4, as well as promising a similar move later for the EU.

Investors in Asia have been bracing themselves for impact from Mr Trump’s pledges on sweeping trade levies, but some had anticipated tariffs might be delayed or avoided on further negotiations following his softer-than-expected tone on China. Still, corporate earnings are bound to take a hit, given many economies in the region are heavily exposed to US exports, analysts say. 

The new tariffs may hurt China’s exports particularly and undermine its already-struggling economy, and in turn trigger Beijing to roll out more forceful stimulus to counter the impact.

“Macro-wise, we think the immediate channel where Asian equities might be impacted is via a potentially higher US dollar,” Nomura Holdings strategists wrote in a note. “We also believe investors are likely to assess which sectors or areas in China might be more exposed to these tariffs.” 

Here are some of the sectors in Asia that saw the biggest impact from Mr Trump’s trade war:

Automakers

Japan’s biggest automakers count on North America as a crucial market and sell cars manufactured or assembled in Mexico near the US border. Shares of Toyota Motor, Honda Motor and Nissan Motor all dropped at least 5 per cent. 

South Korean automaker Kia, which has a plant in Mexico, closed down 5.8 per cent.

Chinese electric-vehicle manufacturers that are seeking to expand their presence in the US market, such as Li Auto and XPeng, were also hit by the new tariffs. Li Auto shares tumbled 5.7 per cent in Hong Kong, while XPeng ended 0.9 per cent lower.

Other non-auto manufacturers in the region with plants in Mexico, such as LG Electronics, also slumped.

E-commerce

Shares of Chinese e-commerce platforms such as JD.com fell 3.2 per cent in Hong Kong as Mr Trump’s plans extinguished a long-held tariff exemption for packages worth less than US$800 (S$1,090). 

Chinese companies that produce small durable items that account for a major part of these so-called de-minimis shipments – such as clothing, accessories, home goods and electronics – also saw their stocks drop. Shares of sportswear maker Li Ning dropped 2.9 per cent in Hong Kong while home appliance maker Haier Smart Home lost 2 per cent.

Chips

Asia’s biggest chip exporters, including Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung Electronics, dropped as Mr Trump said he would tax chips, repeating that vow after his meeting on Jan 31 with Nvidia chief executive officer Jensen Huang. TSMC shares lost 5.7 per cent, while Samsung closed down 2.7 per cent.

Meanwhile, Japanese semiconductor equipment makers, which typically generate the bulk of their revenue from China, also declined. Shares of Tokyo Electron closed down 1.7 per cent, while Advantest and Disco fell 4 per cent.

Some artificial intelligence (AI) related firms in Taiwan that have production in Mexico also took a hit, with shares of Quanta Computer sinking 9.8 per cent.

China’s self-reliance

Shares of Chinese chipmakers such as Semiconductor Manufacturing International Corporation (SMIC) soared 10.3 per cent as traders envision Mr Trump’s tariffs fanning the nation’s quest for industrial self-sufficiency. Beijing has been trying to bolster its own AI chip manufacturing capabilities as Washington limits exporting of what it sees as cutting-edge technology to China.

Oil refiners

Asian oil refiners could emerge as winners from the US tariffs, analysts say, with S-Oil and others in the sector faring better than the broader market. Mr Trump’s trade levies on Canadian and Mexican oil imports may give Asian refineries an edge over their US rivals, while their profit margin is helped by higher product prices. BLOOMBERG