FILE PHOTO: A man looks at a screen showing the Nikkei share average inside a financial building in Tokyo, Japan, September 18, 2025. REUTERS/Kim Kyung-Hoon/File Photo

By Rae Wee

SINGAPORE (Reuters) -Shares in Asia slid on Friday, with pharmaceutical companies hit hard after U.S. President Donald Trump unveiled a fresh round of punishing tariffs and as traders pared bets of sharp U.S. rate cuts following stronger-than-expected economic data.

Trump announced the U.S. would impose 100% duties on imported branded drugs, 25% tariffs on heavy-duty trucks and 50% tariffs on kitchen cabinets.

He also said he would start charging a 50% tariff on bathroom vanities and a 30% tariff on upholstered furniture, with all the new duties to take effect from October 1.

Shares of pharmaceutical companies across Asia tumbled in the aftermath, with Japan's Topix pharmaceutical index last down 1%, while the Hong Kong-listed innovative drug index slid 2.8%.

Shares in South Korean drugmaker SK Biopharmaceuticals fell 2.7%, while Australian biotech firm CSL was last down 1.6%, after slumping more than 3% earlier in the session.

An index tracking Chinese-listed furniture makers also dropped 1.1%.

"We were bracing ourselves for the sectoral tariffs on pharmaceuticals ... I think the key thing is the details are still scant at this stage, but the tariffs seem to only apply to branded or patented drugs. So that's quite important, particularly for India," said Khoon Goh, head of Asia research at ANZ.

"But I think the initial knee-jerk reaction most likely would see probably a continuation of the equity market weakness that we've seen, as investors take a cautious approach."

Broader indexes were also in the red, with the Nikkei last down 0.13% while Hong Kong's Hang Seng Index was off 0.9%.

China's CSI300 blue-chip index eased 0.3%, and MSCI's broadest index of Asia-Pacific shares outside Japan was down more than 1%.

"At this point of time, it sort of adds to a bit of a shaky backdrop we've got in terms of risk assets," Tony Sycamore, a market analyst at IG, said of the latest tariffs.

Nasdaq futures were down 0.12% while S&P 500 futures dipped 0.02%.

European futures, meanwhile, eked out gains, with EUROSTOXX 50 futures up 0.4% while FTSE futures rose 0.3%.

Also adding to headwinds for stocks were reduced expectations of aggressive Federal Reserve rate cuts, after a slew of data on Thursday suggested the U.S. economy remains in rude health.

"(The) data deluge... gives the U.S. economy a new lease on life," economists at Wells Fargo said in a note.

"Ultimately the updated GDP figures suggest the U.S. economy was undeniably resilient in the first half of the year despite the on-again off-again approach to U.S. trade policy."

Traders are pricing in just about 39 basis points worth of rate cuts by December this year, compared to more than 40 bps earlier this week.

Focus will now be on PCE data due later on Friday, which could provide further clarity on the outlook for rates.

"There was some bullish optimism built into markets, because everybody started thinking we're going to get somewhere between four and six rate cuts, and now I think we're probably looking at four at most, and maybe even that seems a bit generous at this point of time into the end of 2026," said IG's Sycamore.

While most Fed policymakers continue to strike a cautious tone on the pace of future easing, the central bank's newest policymaker, Stephen Miran, on Thursday pressed for sharp U.S. interest-rate cuts to prevent labour market collapse.

The reduced expectations of Fed rate cuts have in turn lifted the dollar, which hovered close to the 150 yen level on Friday.

The euro last bought $1.1670, having lost 0.6% in the previous session, while sterling dipped slightly to $1.3341.

In commodities, oil prices edged higher on Friday and were on track to rise at their steepest rate since early June. Brent crude futures were up 0.33% to $69.65 a barrel, while U.S. crude rose 0.46% to $65.28 per barrel. [O/R]

Trump said on Thursday he believed Turkey would agree to his request to stop purchasing Russian oil and that he may lift U.S. sanctions on Ankara so it can buy advanced American F-35 jets, following two hours of talks with Turkey's President Tayyip Erdogan.

Spot gold fell 0.3% to $3,737.71 an ounce. [GOL/]

(Reporting by Rae Wee; Editing by Sam Holmes and Kate Mayberry)