The Chinese stock market opened earlier on Monday, April 7, with significant losses. The wider Asia stock market recorded palpable losses as more investors fled the highly volatile global equity market towards bonds and gold markets. For instance, the Shanghai Composite index had dropped around 6.34 percent to trade about 3,130.17 on Monday during the early Asian trading session.

The Hang Seng Index in Hong Kong was heavily impacted by the ongoing stock market rout. At the time of this writing, the HSI had dropped around 10.70 percent to trade about 20,404. 

Expected Impact on Western Financial Markets 

After China retaliated against the U.S. tariff trade last week, the European Union is expected to announce its reciprocal tariffs this week. Although some nations have opted to negotiate with the United States, major economies are likely to follow in the footsteps of Beijing in the coming days.

Consequently, the U.S. stock market is expected to take more hits later today, especially on major indexes led by the Dow, the S&P 500, and the Nasdaq.

“Big Wall Street trading desks will be manned in time for tonight’s futures open. They are preparing for more selling, intense selling. But you also hear talk about “value” and how some really good stocks are “oversold.” But bearishness is clearly the overwhelming sentiment,” Charles Gasparino, a senior correspondent with FOX and NY Post noted.

Impact on Crypto Industry 

The crypto market has experienced delayed impacts from the ongoing global trade wars, thus briefly earning a title for a reliable store of value. However, Bitcoin price dropped below the crucial support level of about $80k on Sunday, thus triggering nearly $1 billion in crypto liquidations, with $850M involving long traders.

The wider crypto market will likely continue in bearish mode as fear leads more investors. Furthermore, on-chain data shows heavy liquidation of whale investors while others flee to the stablecoins market.

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