China ‘fights back’, Europe still consulting: Markets rise worldwide as Trump’s tariffs to kick in tomorrow | World News

The world is going through a tit-for-tat syndrome that began last week when US President Trump announced sweeping tariffs on dozens of countries and the frontrunner who has hit Washington with ‘countermeasures’ is China.Within 48 hours of Trump’s market-hammering announcement of tariffs on countries across the world, the world’s second-largest economy swiftly retaliated with its own punitive measures on US goods and firms.
After the US President vowed on Monday to ramp up tariffs once again, and threatened to dramatically escalate the conflict between the world’s two largest economies, warning of an additional 50% tariff on Chinese imports to be introduced midweek unless Beijing lifts its retaliatory tariffs Tuesday.
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Beijing reiterated its determination to hold firm. “The US threat to escalate tariffs on China is a make on top of a make. The threat once again exposes the blackmailing nature of the US. China will never accept it. If the US inss on its own way, China will fight to the end,” China’s Commerce Minry said in a statement.
Beijing’s defiance reflects what appears to be a carefully calibrated confidence from a Chinese government intent on positioning itself as a strong opponent to what it has labelled as “unilateral bullying” the United States.
Over the weekend, Chinese authorities sent a clear message to both domestic and international audiences: China is fully prepared to withstand a trade war—and emerge stronger from it.
He also announced that any “requested meetings” from China with the US would be cancelled.Story continues below this ad
However, in this trade war, emerged a silver lining – Markets, shaken the standoff, began to stabilise on Tuesday. Japan’s Nikkei rebounded 6 per cent after Trump and Japan’s PM Shigeru Ishiba agreed to initiate trade talks. Chinese and Hong Kong markets also regained some ground after steep losses on Monday.
Analysts say both countries are locked in a “game of chicken.” Wen-ti Sung of the Atlantic Council noted, CNN reported, “China is determined to signal that the world is still bipolar and won’t let Washington dictate the terms.”
“Zero-for-zero”
The EU, also hit Trump’s tariffs, proposed 25 per cent countermeasures on US goods but said it’s open to a “zero-for-zero” deal, but that it would “not wait endlessly” to defend itself.
EU trade commissioner Maros Šefčovič said the bloc remains open to negotiations but cautioned that talks are in early stages. “The US view tariffs not as a tactical step, but as a corrective measure,” he noted. EU Commission President Ursula von der Leyen confirmed the zero-tariff offer remains on the table.Story continues below this ad
However, Trump rejected the idea, telling reporters: “The European Union’s been very bad to us… They’re going to have to buy their energy from us.”
Despite internal EU disagreements—like Italy proposing a delay in counter-tariffs and France pushing for tougher retaliation—the bloc is preparing to impose duties on up to €26bn of US goods starting 15 April. Items include Harley-Davidsons and jeans, though bourbon may be spared due to French and Irish lobing.
Germany’s economy miner Robert Habeck warned against watering down the EU response, stating, “America is in a position of weakness.” Other leaders like France’s Laurent Saint-Martin called for aggressive retaliation if talks fail, while Ireland urged restraint, rejecting moves to target US tech firms.
Šefčovič confirmed the EU will proceed with retaliation, though the measures may fall short of the €26bn cap. Meanwhile, EU miners began talks in Luxembourg as Trump’s tariffs affect €382bn of EU exports, rattling global markets.Story continues below this ad
Germany’s Habeck slammed Trump’s tariff rationale as “ridiculous” and brushed off Elon Musk’s call for free trade, calling it “a sign of weakness.” With tensions rising, the EU is invoking its anti-coercion powers and preparing further steps if diplomacy falters.
However, the European markets calmed somewhat as a result of offer from there side, UK’s FTSE 100 index is now up 2.5 per cent, or 192 points, to 7894 points, having ended Monday at a one-year closing low.
Germany’s Dax was 1.5 per cent higher while France’s CAC jumped 1.4 per cent. The pan-European Stoxx 600 index rose 1.75 per cent, following gains in many Asia-Pacific markets.
Asia is deciding
Asian investors are cautiously hoping for signs of market stability, following reports that US trade representative Bessent is set to lead negotiations with Tokyo—an indication the Trump adminration may be open to softening its stance on tariffs.Story continues below this ad
The development spurred a modest recovery in regional markets on Tuesday, with Japanese stocks leading the rebound. Tokyo’s Nikkei index jumped 5.6 per cent, clawing back some of the sharp losses from earlier in the week. Hong Kong’s Hang Seng index also rose 1.6 per cent, bouncing back after Monday’s steepest single-day drop since the 1997 Asian financial crisis.
In South Korea, the Kospi index ended 0.5 per cent higher, despite having surged as much as 2.3 per cent earlier in the session.
Markets in India snapped three days of losing streak, with Sensex climbed 1,089 pts to 74,227 and Nifty ended 374.25 pts higher at 22,535.
Meanwhile, Taiwan’s benchmark TWII index remained under pressure, closing down 5 per cent on Tuesday. The decline followed a record-breaking fall on Monday, as investors reacted to a newly imposed 32 per cent US tariff on Taiwanese chip exports—an industry that makes up a significant portion of the island’s economy.Story continues below this ad
Tokyo’s move potentially set a template for other countries in the continent to follow in seeking similar resolutions. Several nations appear keen to take a conciliatory approach. Bangladesh, the world’s second-largest exporter of ready-made garments after China, has offered to purchase various US agricultural products, including cotton, duty-free, in an attempt to avoid retaliatory US tariffs. Cambodia, Vietnam, Indonesia and Thailand are also reportedly exploring similar diplomatic overtures.
Despite these partial rebounds, investor sentiment across the region remains fragile. Analysts say the road to resolution could be long, and much will depend on the outcome of upcoming trade talks. Until then, markets are expected to remain volatile as investors weigh headlines and policy signals from both Washington and Beijing.
And, amid all this , it’s just one day to go for even higher tariffs ranging from 11 per cent to 50 per cent will be imposed on goods from 57 countries, including key allies such as the UK, Japan, and the entire European Union.