Japan’s benchmark index Nikkei showed an average fall on Friday after Germany’s Daimler cut its profit citing tariff concerns and some U.S. data came in below expectations, hurting cyclical stocks.
The auto sector saw a significant drop of 2.2 per cent, becoming the worst performer on board.
The fall came after Germany’s Daimler cut its profit forecast for this fiscal year because of fears over tariffs on the Mercedes Benz cars it exports from the United States to China.
BMW said it was looking at “strategic options” because of the trade dispute between the United States and China.
Toyota Motor Corp’s share dropped 2.8 per cent, Honda Motor Co and Mazda Motor Corp fell about 2.3 per cent.
The Nikkei fell 0.9 per cent to 22,480.90 in midmorning trade. The benchmark index has declined 1.6 per cent in this week.
“The weak U.S. economic data and trade war headlines are all hurting the Japanese market’s sentiment and prompting a sell-off in blue-chip stocks,” said Yoshinori Shigemi, global market strategist at JPMorgan Asset Management.
At the starting of this week, U.S. President Donald Trump threatened to put in place a 10 per cent tariff on $200 billion of Chinese goods while Beijing warned it would fight back.
India who is the world’s biggest buyer of U.S. almonds, hiked import duties on the commodity by 20 per cent, indicating its unison with the European Union and China in retaliating against Trump’s tariff hikes on steel and aluminium.
“People started to worry seriously that the global economy will falter,” Shigemi said.