Asian stock markets fell sharply on August 1, 2025, as global trade tensions escalated following U.S. President Donald Trump's sweeping new tariff order. Investors also turned cautious ahead of the much-anticipated U.S. non-farm payrolls data, which could determine the Federal Reserve's next rate move.

Late Thursday, Trump signed an executive order imposing tariffs ranging from 10% to 41% on a wide array of imports from multiple countries. Notably, India’s U.S.-bound exports were hit with a 25% tariff, Taiwan faced 20%, Thailand 19%, and South Korea 15%. The U.S. also raised duties on Canadian goods to 35% from 25% for all items not included in the U.S.-Mexico-Canada trade agreement. Mexico was granted a 90-day exemption.

The protectionist move sparked fresh concerns of a global trade war, leading to broad-based weakness in Asian equities. EUROSTOXX 50 futures fell 0.5%, while Nasdaq futures and S&P 500 futures were down 0.5% and 0.3%, respectively. The decline was compounded by Amazon’s disappointing earnings, which sent its stock tumbling 6.6% in after-hours trading, further dragging sentiment in U.S. tech-heavy indices.

Markets are now bracing for the U.S. jobs report due later today, which could heavily influence the Federal Reserve’s September interest rate decision. A stronger-than-expected print may diminish hopes of a rate cut, while weaker data could reinforce the need for monetary easing amid mounting economic uncertainty.

With geopolitical risks resurfacing and central bank policy hanging in the balance, global markets may remain volatile in the days ahead.