Dubai Telegraph - Asian stocks down after Trump Fed firing, tariff threats

Traders had been riding a wave of confidence since Friday's speech by US Federal Reserve Chairman Jerome Powell, which suggested coming interest rate cuts in the world's largest economy.

But the upward flurry appeared to die out Monday on Wall Street as attention turned back to this week's earnings report from AI chip giant Nvidia -- a bellwether for the industry as concerns over a tech bubble mount.

Asian markets started Tuesday broadly lower, tracking drops made the previous day in New York and Europe.

Tokyo's main index saw the largest fall, down over one percent just ahead of the midday break. Benchmarks in Hong Kong, Shanghai, Seoul, Taipei and Sydney were also down.

Weighing on investors' minds was Trump's Monday evening announcement in the United States that he was removing Federal Reserve governor Lisa Cook, citing allegations of false statements on her mortgage agreements.

The highly unusual step comes as worries grow about the independence of the central bank, fuelled by Trump's repeated public demands on Powell to lower interest rates.

The dollar fell following the news, while gold -- widely perceived as a safe storage of wealth -- advanced.

"The independence of the Fed, already a fraying banner, looks tattered against the gusts of politics," wrote Stephen Innes of SPI Asset Management in a note.

"What's left is a central bank suddenly with a missing vote, a looming inflation test on Friday and a president willing to make personnel changes with the flair of a ringmaster cracking the whip," he added.

Eyes are now turning toward a US GDP report on Thursday and a key inflation gauge coming on Friday for clues on how far interest rates might fall -- or not -- in the coming months.

Trump also vowed Monday evening to impose "substantial additional tariffs" on shipments from countries that do not cancel digital taxes and regulations, which he said were "designed to harm" US technology.

He added a threat to introduce export restrictions on "highly protected (US) technology and chips", without offering further details.

Oil prices crept down Tuesday, walking back increases made in recent days amid speculation about a peace deal to end the war in Ukraine.

- Key figures at around 0215 GMT -

Tokyo - Nikkei 225: DOWN 1.0 percent at 42,365.52

Hong Kong - Hang Seng Index: DOWN 0.3 percent at 25,740.95

Shanghai - Composite: DOWN 0.2 percent at 3,875.732

Euro/dollar: UP at $1.1644 from $1.1624 on Monday

Pound/dollar: UP at $1.3475 from $1.3460

Dollar/yen: DOWN at 147.42 yen from 147.70 yen

Euro/pound: UP at 86.42 pence from 86.35 pence

West Texas Intermediate: DOWN 0.5 percent at $64.49 per barrel

Brent North Sea Crude: DOWN 0.4 percent at $68.51 per barrel

New York - Dow: DOWN 0.8 percent at 45,282.47 (close)

London - FTSE 100: CLOSED Monday for Summer Bank Holiday

A.Ragab--DT