Equities across the planet have been hammered in recent weeks ahead of Donald Trump's "Liberation Day" on April 2, when his administration will unveil a series of levies against friend and foe alike, citing what he says are unfair trading practices.
His announcement last week that he would also impose 25 percent duties on imports of all vehicles and parts ramped up the fear factor on trading floors, hammering car giants including Japan's Toyota, the world's biggest.
Governments around the world have pushed back on Trump's tariffs, and could announce more countermeasures, while Canadian Prime Minister Mark Carney told Trump on Friday that he will implement retaliatory tariffs to protect his country's workers and economy.
Adding to the dour mood was data showing the Federal Reserve's preferred gauge of inflation rose more than expected last month amid worries Trump's tariffs will fan price rises and further dent hopes for interest rate cuts.
Japan's Nikkei 225 index plunged more than four percent at one point, extending last week's slide, as Toyota, Nissan and Mazda shed more around three percent, while tech investment titan SoftBank tanked more than five percent.
Zensho Holdings, which owns several Japanese restaurant franchises, plunged five percent after its beef bowl chain Sukiya said it would temporarily shut nearly all of its roughly 2,000 branches after a rat was found in a miso soup and a bug in another meal.
Seoul was also sharply lower.
"Within the Asia-Pacific region, the car levies will hit Japan and South Korea the hardest. About six percent of Japan's total exports are cars shipped to the US. In South Korea's case, it's four percent," Moody's Analytics economists wrote.
"Such a sizeable tariff hike will undermine confidence, hit production and reduce orders. Given the long and complex supply chains in car manufacturing, the impact will ripple through these countries' economies.
"Back-of-the-envelope calculations suggest the action could shave 0.2 to 0.5 percentage points from growth in each."
There were also losses in Hong Kong, Sydney, Shanghai, Wellington, Taipei and Manila.
Gold, a safe haven in times of uncertainty and turmoil, hit a record high of $3,106.79.
The selling followed a hefty selloff on Wall Street, where the Dow tumbled 1.7 percent, the S&P 500 lost 2.0 percent and the Nasdaq dived 2.7 percent.
US investors were jolted by figures showing the core personal consumption expenditures (PCE) index came in above forecasts in February.
Analysts said that while the reading was not a blowout, its timing amid a period of uncertainty added to the sense of gloom, when traders had been hoping for a little reassurance.
"Markets will now be fully at the mercy of an impending deluge of tariff-related headlines, while highly reactive to any US economic data that accelerates the thematic of slower economic activity and higher expected inflation," said Chris Weston at Pepperstone.
- Key figures around 0230 GMT -
Tokyo - Nikkei 225: DOWN 3.9 percent at 35,691.52 (break)
Hong Kong - Hang Seng Index: DOWN 0.6 percent at 23,278.18
Shanghai - Composite: DOWN 0.1 percent at 3,349.68
Euro/dollar: DOWN at $1.0833 from $1.0838 on Friday
Pound/dollar: UP at $1.2958 from $1.2947
Dollar/yen: DOWN at 149.05 yen from 149.72 yen
Euro/pound: DOWN at 83.60 pence from 83.68 pence
West Texas Intermediate: DOWN 0.4 percent at $69.08 per barrel
Brent North Sea Crude: DOWN 0.3 percent at $73.42 per barrel
New York - Dow: DOWN 1.7 percent at 41,583.90 (close)
London - FTSE 100: DOWN 0.1 percent at 8,658.85 (close)
dan/fox
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