HONG KONG, June 2, 2025 (AFP) - Asian stocks sank Monday after Donald Trump last week lobbed a fresh trade missile by doubling tariffs on steel and aluminium and accused China of violating last month's agreement to slash tit-for-tat levies.

The US president's comments were followed by claims by his commerce secretary that Beijing had been slow to implement the deal, which helped rally markets last month and fanned hopes for a lasting detente between the world's top economies.

Still, Treasury Secretary Scott Bessent -- who last week warned negotiations with China were "a bit stalled" -- said the US leader could speak with his Chinese counterpart Xi Jinping "very soon" in talks that could help break the impasse.

The latest salvos from the White House came as it faces a legal battle after a trade court on Wednesday blocked Trump's "Liberation Day" tariff blitz, saying he had overstepped his authority with the across-the-board taxes.

An appeals court gave the levies a stay of execution on Thursday but the wrangle could drag on, causing more uncertainty.

Trump said Friday he would jack up steel and aluminium to 50 percent, from 25 percent, which he said "will even further secure the steel industry".

He also claimed Beijing had "totally violated" last month's agreement with China to cut eye-watering tariffs for 90 days to hammer out a broader package.

Later, Commerce Secretary Howard Lutnick told "Fox News Sunday" that Beijing had been "slow-rolling the deal".

Chinese officials accused Washington of making "bogus charges and unreasonably accused China of violating the consensus, which is seriously contrary to the facts".

The developments have thrown the trade war back into the spotlight, having been put on the back burner after the China detente and indications that governments were working deals with US officials.

"As we await whether the 90-day truce will result in a more permanent resolution, we are left wondering what may happen if progress stalls and the US and China are unable to make a deal," said Kai Wang, Asia equity market strategist at Morningstar.

"Trump is already making headlines again on reimposing EU tariffs.

"Should this happen with the EU or China, markets will likely crater again and will see much greater volatility given the heightened uncertainty with regard to global growth."

Asian markets sank Monday as investors brushed off data showing the Federal Reserve's favoured inflation gauge cooled more than expected last month, with fears about the impact of the tariffs on the economy back in focus.

Hong Kong dropped more than two percent, with property firms taking a heavy hit on worries over the future of New World Development after it deferred interest payments on some bonds.

The firm is in the middle of a loan refinancing drive as it looks to raise more than US$11 billion from banks. Its struggles have revived fears about China's property sector as companies struggle to sell stock to help pay off their bulging debts.

Tokyo, Sydney, Singapore, Taipei, Manila and Jakarta also fell, with Shanghai closed for a holiday.

Oil prices surged after OPEC and other key producers hiked output for July but less than expected, while geopolitical fears were ramped up after Ukraine hit air bases deep inside Russia, raising concerns over an escalation of the three-year war.

The dollar also retreated on concerns about the US economy as Trump continues to push a bill to extend tax cuts and slash welfare spending, which observers say will add trillions to the already gargantuan national debt.

That has sent shivers through the Treasuries market, with yields pushing higher as investors seek out better returns for lending the government money.

Worries about US debt led Moody's to lower the United States last top-ranking credit rating, warning it expects US federal deficits to widen dramatically over the next decade.

Meanwhile, JPMorgan Chase chief executive Jamie Dimon voiced concern Sunday at the risk of a looming US debt market crisis sparked by Trump's policies.

"It's a big deal. It is a real problem," Dimon told Maria Bartiromo on FOX Business Network's "Mornings with Maria" show, according to an excerpt of the interview that will air in full Monday.

"The bond market is going to have a tough time. I don't know if it's six months or six years," he said.

- Key figures at around 0230 GMT -

Tokyo - Nikkei 225: DOWN 1.5 percent at 37,414.02 (break)

Hong Kong - Hang Seng Index: DOWN 2.3 percent at 22,753.81

Shanghai - Composite: Closed for a holiday

Euro/dollar: UP at $1.1370 from $1.1349 on Friday

Pound/dollar: UP at $1.3493 from $1.3463

Dollar/yen: DOWN at 143.50 yen from 143.97 yen

Euro/pound: DOWN at 84.26 pence from 84.30 pence

West Texas Intermediate: UP 2.8 percent at $62.50 per barrel

Brent North Sea Crude: UP 2.5 percent at $64.34 per barrel

New York - Dow: UP 0.1 percent at 42,270.07 points (close)

London - FTSE 100: UP 0.6 percent at 8,772.38 (close)