Japanese Prime Minister Shigeru Ishiba says his government will continue to ask US President Donald Trump to lower tariffs against Japan, but admits results “won’t come overnight”.

“As such, the government must take all available means” to cushion the economic blow from US tariffs, such as offering funding support for domestic firms and taking measures to protect jobs, Ishiba told parliament on Monday.

Ishiba said Trump’s decision to slap tariffs on imports from Japan was “extremely disappointing and regrettable”, adding that Japan would continue to explain that it had done nothing unfair to the United States.

Ishiba also said he was willing to visit the United States for a meeting with Trump as soon as possible.

“But in doing so, we must ready a package of steps on what Japan could do,” he added.

Trump’s decision to slap a 25 per cent levy on auto imports, and a reciprocal 24 per cent tariff on other Japanese goods, is expected to deal a huge blow to Japan’s export-heavy economy with analysts predicting the higher duties could knock up to 0.8 per cent off economic growth.

Australian shares tanked early trading, wiping roughly $155 billion of the top 500 stocks after China announced it would respond in-kind to US tariffs, escalating fears of a global trade war and recession.

The S&P/ASX200 plummeted 460.3 points in early trading, or 5.99 per cent, to 7,2106, as the broader All Ordinaries fell 464.7 points, or 5.92 per cent, to 7,388.8.

The sell-off in the All Ordinaries 500 most valuable stocks on the bourse equated to more than $155 billion of the $2.6 trillion market value.

All 11 local sectors were deep in the red barely an hour into the session with financial stocks, which account for almost a third of the bourse’s value, shedding 7.2 per cent.

The fall follows a Wall Street furore on Friday, after China vowed to place a 34 per cent retaliatory tariff on the US in response to president Donald Trump’s ‘Liberation Day’ tariffs.

Materials stocks, which comprise almost a fifth of the local stock market’s value, were down eight per cent.

Energy stocks also tanked, down 9.6 per cent as crude demand worries pushed oil prices off a cliff.

Brent crude futures were trading at $US63.17 a barrel, the oil price down more than 18 per cent since Trump launched the tariffs last week, crushing crude demand expectations.

The White House has previously vowed to meet any retaliatory tariffs with even higher imposts, stoking fears of a race-to-the-bottom trade war that could in turn trigger a global recession.

“The sell-off in US stock markets has intensified this morning after China retaliated on Friday night,” IG Markets analyst Tony Sycamore said.

This had sparked “fears of a full-blown trade war, imminent recession, and a liquidity crunch last seen during the COVID crash of 2020”, he warned.

The slide in equities markets is expected to continue after US stock futures fell ahead of Wall Street resuming trading later on Monday.

Investors were short-selling markets in the UK, the European Union and Australia, Westpac economist Ryan Wells said.

“Stock market volatility spiked at a new post-pandemic high as the historic sell-off in global equities persists,  Mr Wells wrote in a research note.

Crude oil and copper prices are down while gold has unwound most of the rally seen in late March.

The Australian dollar fell below 60 US cents to 59.98 US cents to be down more than six per cent since the tariffs were announced on Thursday. 

Asian stock markets have plunged as fears of a global trade war saw Wall Street futures dive, and investors wagered the mounting risk of recession could see US interest rates cut as early as May.

Futures markets moved swiftly on Monday to price in almost five quarter-point cuts in US rates this year, pulling Treasury yields down sharply and hampering the dollar.

The carnage came as White House officials showed no sign of backing away from their sweeping tariff plans, and China declared the markets had spoken on their retaliation through levies on US goods.

US President Donald Trump told reporters that markets would have to take their medicine and he would not do a deal with China until the US trade deficit was sorted out.

Investors had thought the loss of trillions of dollars in wealth and the likely body blow to the economy would make Trump reconsider his plans.

“The size and disruptive impact of US trade policies, if sustained, would be sufficient to tip a still healthy US and global expansion into recession,” said Bruce Kasman, head of economics at JPMorgan, putting the risk of a downturn at 60 per cent.

“We continue to expect a first Fed easing in June,” he added.

“However, we now think the Committee cuts at every meeting through January, bringing the top of the funds rate target range down to 3.0 per cent.”

S&P 500 futures slid 4.31 per cent in volatile trade, while Nasdaq futures dived 5.45 per cent, adding to last week’s almost $US6 ($A10) trillion in market losses.

Japan’s Nikkei sank 7.8 per cent to lows last seen in late 2023, while South Korea lost 4.6 per cent.

The gloomier outlook for global growth kept oil prices under heavy pressure, following steep losses last week.

Brent fell $US2.12 ($A3.54) to $US63.46 ($A105.95) a barrel, while US crude dived $US2.05 ($A3.42) to $US59.94 ($A100.07) per barrel.

The flight to safe havens saw Treasury futures surge a full point, a very rare move for Asian trade, while Fed fund futures jumped to price in an extra quarter-point rate cut from the Federal Reserve this year.

Markets swung to imply around a 63 per cent chance the Fed could cut as soon as May, even though Chair Jerome Powell on Friday said the central bank was in no hurry on rates.

Yields on 10-year Treasuries dropped 10 basis points to 3.897 per cent amid the general flight from risk assets.

That dovish turn saw the dollar slip another 0.9 per cent on the safe-haven Japanese yen to 145.59 yen, while the euro held firm at $1.0955.

The dollar shed 1.2 per cent on the Swiss franc to 0.8501, while the trade-exposed Australian dollar dropped a further 0.7 per cent.

Investors were also wagering the imminent threat of recession would outweigh the likely upward shove to inflation from tariffs.

US consumer price figures out later this week are expected to show another rise of 0.3 per cent for March, but analysts assume it is just a matter of time before tariffs push prices sharply higher, for everything from food to cars.

Rising costs will also put pressure on company profit margins, just as the earnings season gets underway with some of the big banks due on Friday. Around 87 per cent of US companies will report between April 11 and May 9.

“We expect during upcoming quarterly earnings calls fewer companies than usual will provide forward guidance for both 2Q and full-year 2025,” analysts at Goldman Sachs said in a note.

“Rising tariff rates will force many companies to either raise prices or accept lower profit margins,” they warned.

“We expect negative revisions to consensus profit margin estimates in coming quarters.”

Even gold was swept up in the selloff, easing 0.7 per cent to $US3,013 ($A5,030) an ounce.

The drop left dealers wondering if investors were taking profits where they could to cover losses and margin calls on other assets, in what could turn into a self-feeding fire sale.

Public servants are breathing a sigh of relief after the coalition ditched a plan that would have forced federal government workers to give up working from home.

The opposition’s proposal fuelled voters’ concerns that ending pandemic-era work-from-home policies for government departments would encourage the private sector to follow suit, if the coalition won the May 3 election.

And with one month to go until Australians go to the polls, Mr Dutton buried the plan.

“We have the extraordinary position of Peter Dutton who – having defended his attack on working from home – is now pretending that the program won’t succeed,” Prime Minister Anthony Albanese told reporters in Melbourne on Monday.

“He’s pretending that the policies he announced … just don’t exist and that everyone will just forget about all that.”

Mr Dutton also apologised for the work-from-home ban as he announced the reversal.

“We got it wrong, we’ve apologised for it, we support flexible workplace arrangements,” he told reporters in Adelaide.

The work-from-home policy risked turning off female voters and Mr Albanese had used this to paint Labor as the party for workers.

Labor contends that flexible work arrangements particularly benefit women who can take on more work while being able to look after children at home.

The share of women working full-time has increased from 54 per cent to 58 per cent as work-from-home arrangements have become more common since COVID-19, Australian Bureau of Statistics data shows. 

This may also be, in part, due to increased public spending in traditionally female-dominated industries like health and child care, but studies have shown that working from home has reduced the gender pay gap.

Labor analysis shows that families where women are forced to drop work as a result of cuts to flexibility arrangements could lose as much as $740 a week in income.

“(Mr Dutton) wants to rip the heart out of fairness in our industrial relations system, doesn’t matter whether it’s work from home, same job same pay, casualisation, gender equity on the workforce,” the prime minister said.

The coalition has also backed off on plans to fire public servants, with finance spokeswoman Jane Hume saying the sector would be whittled down by 41,000 over five years through a hiring freeze and natural attrition, not forced redundancies.

Mr Dutton now claims this was “always the plan” and accused Labor of “contorting that into something else”.

“For us, the priority is how we help families,” he said.

“Australians will be asking: who do they trust to manage the economy?”

However, the backflips have raised questions over how the coalition plans to find savings – if it wins government on May 3 – after saying the cuts to the public service would save $7 billion.

As Mr Albanese and Mr Dutton enter the second week of the election campaigns, the opposition leader is hoping to turn a new leaf and shift momentum.

The latest Newspoll shows Labor is leading the coalition 52 per cent to 48 per cent on a two-party-preferred basis, after the government extended its lead.

The opposition leader will be in Adelaide courting voters, while Mr Albanese has spruiked transport promises in Melbourne.

Peter Dutton has walked back a coalition plan to force federal government workers to give up working from home arrangements and shifted his stance on public sector jobs.

The work-from-home policy, which has been in place since the pandemic, had fuelled concerns amongst voters who favoured the practice that it would encourage the private sector to follow suit.

With one month to go until Australians go to the polls, Mr Dutton had backed down.

“We made a mistake in relation to this,” he told the Today show on Monday.

“It’s important that we say that and recognise it.

“We’ve listened to Australians and we’ve made it very clear that work from home is a reality for many people, for our friends, for people in our workplace and we’re supportive of that.”

The coalition has also backed off on plans to fire public servants, with finance spokeswoman Jane Hume saying the sector would be whittled down by 41,000 over five years through a hiring freeze and natural attrition.

“There will be no forced redundancies,” she told Sky News.

Mr Dutton now claims this was “always the plan” and accused Labor of “contorting that into something else”.

“For us, the priority is how we help families,” he said.

“Australians will be asking: who do they trust to manage the economy?”

However, the backflips have raised questions over how the coalition plans to find savings – if it wins government on May 3 – after saying the cuts to the public service would save $7 billion.

Labor had used the unpopular policies to sow doubt about the opposition’s plans, claiming the cuts would be the first in a ‘long, unknown list’.

Labor cabinet ministers are now arguing that Mr Dutton’s u-turns show he can’t be trusted.

“Peter Dutton will say anything to get himself elected as prime minister,” Workplace Minister Murray Watt told the ABC.

The work-from-home policy, in particular, had risked turning off female voters.

“Peter Dutton’s personal satisfaction ratings have sunk like a stone to his lowest ever in YouGov’s public data poll since he tied himself to Trump-style policies of banning work from home and sacking 40,000 public sector workers,” YouGov’s Paul Smith said.

Labor contends that flexible work arrangements particularly benefit women who can take on more work while being able to look after children at home.

The share of women working full-time has increased from 54 per cent to 58 per cent as work-from-home arrangements have become more common since COVID-19, Australian Bureau of Statistics data shows. 

This may also be, in part, due to increased public spending in traditionally female-dominated industries like health and child care, but studies have shown that working from home has reduced the gender pay gap.

Labor analysis shows that families where women are forced to drop work as a result of cuts to flexibility arrangements could lose as much as $740 a week in income.

As Prime Minister Anthony Albanese and Mr Dutton enter the second week of the election campaigns, the opposition leader is hoping to turn a new leaf and shift momentum.

The latest Newspoll shows Labor is leading the coalition 52 per cent to 48 per cent on a two-party-preferred basis, after the government extended its lead.

The opposition leader will be in Adelaide courting voters, while Mr Albanese is expected to spruik Labor’s policies in Melbourne.

Thousands of people swooned in a dark conference hall that felt more like a rock concert when a Microsoft product manager demonstrated the company’s latest feature: how to sum numbers in Excel, with the click of a button.

“It was literally like Mick Jagger walked out,” said Yusuf Mehdi, Microsoft’s consumer chief marketing officer, who started as an intern.

That was more than 30 years ago. On Friday, the day Microsoft turned 50, the company’s leaders and staff gathered at its headquarters in Redmond, Washington, to remember the software maker’s glory days while trumpeting what they hope will bring it into the future: more powerful artificial intelligence.

Copilot, Microsoft’s AI assistant, is gaining a host of new features to make it more proactive. The version for consumers will start remembering personal facts about them. It will offer birthday reminders or support ahead of a presentation, or consumers can opt out, Mehdi said in an interview.

Copilot likewise will personalise podcasts and shopping recommendations, and it will let consumers task their AI to make reservations for them. 

“It frees you up,” said Mehdi.

Microsoft is hardly first to roll out action-taking or “agentic” software. As with rival systems, the AI will work best on popular sites where Microsoft has done some behind-the-scenes technical work, like with 1-800-Flowers.com and OpenTable, Mehdi said.

Mehdi recalled days when Microsoft was smaller and growing. He said CEO Bill Gates could devour three books’ worth of information from one day to the next, at a time when the co-founder still worked on Microsoft software. 

Mehdi watched Steve Ballmer, Gates’ eventual successor, chant “developers, developers, developers!” in a sweat-drenched shirt to rouse a crowd into the “.net” era.

Microsoft went from top of the pack to badly bruised in a high-profile lawsuit that US antitrust enforcers brought against it in 1998. Years later, younger companies and startups, among them Alphabet and ChatGPT maker OpenAI, beat it to the punch on key AI developments.

Satya Nadella, Microsoft’s current CEO, is not standing still. The leader who turned Microsoft into the No. 2 cloud powerhouse challenged his executives at an internal summit this week, recalled Mehdi: “How do we rethink the way that we build the software?”

Nadella voiced a similar view at Microsoft’s Redmond event on Friday, where he, Gates and Ballmer made a rare joint public appearance. Ballmer reprised his “developers!” chant as well.

Nadella said the company was not simply celebrating its past 50 years but creating a future defined by “what we empower others to build.”

Gates said, “We’re on the verge of something even more profound than what came for those first 50 years.” Asked what he wished for Microsoft at age 100, he said: “I hope Copilot’s a good CEO.”

Microsoft is iterating on its chatbot technology in a crowded field that includes Elon Musk’s xAI and Anthropic. It has added Copilot to its heavily used productivity suites for business while giving consumers a distinctive version.

“It’s warm; it has that personality,” said Mehdi. Some users have taken to this, while others find it asks too many questions, he added.

“When we get to now be more personalised, we can start to get smarter. 

“We’re part way through that journey.” 

Peter Dutton thought ending work from home for public servants would be a home run, but the Liberal leader is baulking now the policy appears to be striking out.

Labor senses its chance for a grand slam.

Backlash to policies resembling those favoured by Donald Trump and polling showing strong support for work from home have seemingly unnerved the coalition.

“Peter Dutton’s personal satisfaction ratings have sunk like a stone to his lowest ever in YouGov’s public data poll since he tied himself to Trump-style policies of banning work from home and sacking 40,000 public sector workers,” said YouGov’s Paul Smith.

The measure also risks exposing a key vulnerability by turning off female voters.

Labor contends flexible work arrangements particularly benefit women who can take on more work while being able to look after children at home.

The share of women working full-time has increased from 54 per cent to 58 per cent as work-from-home arrangements have become more common since COVID-19, Australian Bureau of Statistics data shows. 

This may also be due in part to increased public spending in traditionally female-dominated industries like health and child care, but studies have shown working from home has reduced the gender pay gap.

Labor analysis shows families with women forced to drop work as a result of cuts to flexibility arrangements could lose as much as $740 a week in income.

“Many parents work full-time, while making time for family. And with cost-of-living pressures, many families can’t afford it any other way,” said Prime Minister Anthony Albanese.

“Peter Dutton and the coalition want to end that flexibility, and it would have real consequences for Australian families.”

The government has taken the coalition’s policy and run with it, while Mr Dutton has walked it back.

Neither public servants nor work-from-home mandates featured in a campaign speech to supporters in Tasmania on Sunday.

Mr Dutton’s only references to the policy in recent days have been to water down his earlier promise to force all public servants back to the office five days a week.

“I strongly support work from home,” he told reporters in Darwin at the weekend. 

“I’ve been very clear about that and our policy … doesn’t have any impact on the public sector outside of Canberra.”

That’s a clear change in rhetoric from comments by opposition workplace spokeswoman Michaelia Cash on March 6.

“It is an expectation of a Dutton government that the Australian Public Service will move towards returning to work five days a week from the office,” she told Sydney radio station 2SM.

More than 50 countries have reached out to the White House to begin trade talks, a top economic adviser to US President Donald Trump said, as US officials sought to defend sweeping new tariffs that have unleashed global turmoil.

During an interview on ABC News’ This Week, US National Economic Council Director Kevin Hassett denied that the tariffs were part of a strategy by Trump to crash financial markets to pressure the US Federal Reserve to cut interest rates.

He said there were would be no “political coercion” of the central bank. In a Truth Social post on Friday, Trump shared a video that suggested his tariffs aimed to hammer the stock market on purpose in a bid to force lower interest rates.

In a separate interview on NBC News’s Meet the Press, US Treasury Secretary Scott Bessent downplayed the stock market drop and said there was “no reason” to anticipate a recession based on the tariffs.

Trump jolted economies around the world after he announced broad tariffs on US imports on Wednesday, triggering retaliatory levies from China and sparking fears of a globe trade war and recession.

On Sunday morning talk shows, top Trump officials sought to portray the tariffs as a savvy repositioning of the US in the global trade order and the economic disruptions as a short-term fallout.

US stocks have tumbled by around 10 per cent in the two days since Trump announced a new global tariff regime that was more aggressive than analysts and investors had been anticipating.

It is a drop that market analysts and large investors have blamed on Trump’s aggressive push on tariffs, which most economists and the head of the US Federal Reserve believe risk stoking inflation and damaging economic growth.

Tariff-stunned markets face another week of potential tariff turmoil, with fallout from Trump’s sweeping import levies keeping investors on edge after the worst week for US stocks since the onset of the COVID-19 crisis five years ago.

Hassett told ABC News’ This Week that Trump’s tariffs had so far driven “more than 50” countries to contact the White House to begin trade talks.

Taiwan’s President Lai Ching-te on Sunday offered zero tariffs as the basis for talks with the US, pledging to remove trade barriers rather than imposing reciprocal measures and saying Taiwanese companies will raise their US investments.

Unlike other economists, Hassett said he did not expect a big hit to consumers because exporters were likely to lower prices.

Bessent told NBC News he did not anticipate a recession based on the tariffs, citing stronger-than-anticipated US jobs growth.

“We could see from the jobs number on Friday, that was well above expectations, that we are moving forward, so I see no reason that we have to price in a recession,” Bessent said.

US and Vietnamese businesses have asked the Trump administration to delay its planned 46 per cent tariff on Vietnamese goods, saying the levy will hurt them and bilateral commercial relations.

The Vietnam Chamber of Commerce and Industry and the American Chamber of Commerce in Hanoi expressed concern to Commerce Secretary Howard Lutnick in a letter dated Saturday, saying the tariff, to take effect on Wednesday, was “shockingly high”.

“Lower tariffs for products coming into Vietnam, and for products reaching the American consumer is what will help US companies, the economy, and consumers,” the organisations said in a statement. 

“Higher tariffs will not.”

The Southeast Asian country, a major regional manufacturing base for many Western companies, posted a trade surplus of more than $US123 billion ($A204 billion) with the US – its largest export destination – in 2024.

President Donald Trump and Vietnamese leader To Lam agreed on Friday to discuss a deal to remove tariffs, both said after a phone call Trump called “very productive”.

Even before Trump’s Wednesday announcement of sweeping global tariffs, Vietnam cut several duties as part of a series of concessions to the US, including pledges to buy more American goods such as planes and agriculture products.

“A fast and fair agreement would add certainty for businesses and would help to rectify the trade imbalance between the two countries in a manner that benefits both countries,” the organisations said in the letter.

There are decades where not much happens to the economy and there are weeks where decades happen.

Last week was such a one.

Rate cut expectations eased modestly after the Reserve Bank of Australia held the cash rate steady on Tuesday but then on Thursday, markets were rocked when US President Donald Trump’s ‘liberation day’ tariffs exceeded traders’ fears.

Expectations jumped from two cuts by the end of the year before the announcement to four after.

“What a difference a few days can make!” remarked HSBC chief economist Paul Bloxham.

The central bank appeared cautious in its post-meeting commentary, with governor Michele Bullock again noting concern over tightness in the labour market, Mr Bloxham said.

But he now expects the RBA to cut rates to 3.1 per cent by early 2026 – 50 basis points lower than before – because of the negative impact the tariffs will have on global growth.

Additionally, cheap goods diverted to Australia are likely to put downward pressure on imported inflation.

HSBC, ANZ and Barrenjoey all pulled forward their rate cut predictions to the RBA’s next meeting in May.

Traders will pay close attention to Ms Bullock as she delivers a speech at the Chief Executive Women annual dinner in Melbourne on Thursday.

Will her reaction to the tariffs be as dovish as the market assumes?

“We’d expect a significant shift in rhetoric and for Bullock to make clear that the board stands ready to ease if the outlook softens,” ANZ economists said in a research note.

In its twice-yearly Financial Stability Review on Thursday, the RBA noted uncertainty posed by the tariffs could have a “chilling effect” on household and business spending decisions, impacting economic activity.

Westpac’s consumer confidence index and NAB’s business survey, both set to be released on Tuesday, will show how households and firms reacted to the federal budget, delivered on March 25.

But any jitters raised by the prospect of an escalating trade war won’t show up in full until next month’s surveys.

Meanwhile, investors on Wall Street have the jitters with indices nosediving for a second straight day.

The Nasdaq Composite on Friday confirmed a bear market and the Dow Jones Industrial Average entered a correction, as the escalating global trade war spurs the biggest losses since the COVID pandemic.

The S&P 500 lost 322.72 points to end at 5,073.80 points, while the Nasdaq lost 962.82 points to 15,587.79 and the Dow fell 2,237.52 points to 38,314.49.

Australian futures fell 331 points, or 4.28 per cent, to 44.185, while the dollar tumbled to a five-year-low against the greenback and fleetingly dipped under US60¢.

Local shares fell to an eight-month low, with more than $96 billion wiped from the top 500 stocks.

The S&P/ASX200 on Friday sank 188.9 points, or 2.4 per cent, to 7,670.8, while the broader All Ordinaries tanked 202.5 points, or 2.51 per cent, to 7,850.2.