By Agence France-Presse
There was little sign of relief after equities suffered a pummelling last week in response to tit-for-tat warnings by Beijing and Washington, which has fuelled concerns about the potential damage to the world economy.
The uncertainty overshadowed a modest increase in oil output agreed by OPEC and Russia -- which sent energy firms surging with crude prices -- and Chinese easing measures.
Tokyo ended the morning session 0.4 percent lower, while Hong Kong was off 0.3 percent. Shanghai eased 0.2 percent and Sydney lost 0.2 percent.
Singapore shed 0.5 percent, Seoul dipped 0.3 percent, Taipei was 0.8 percent lower and Wellington gave back 0.1 percent.
Concerns the tariff spat could turn into a full-blown trade war were stoked Monday following reports that the Treasury Department is looking at an emergency law beefing up scrutiny of investment by Chinese firms in sensitive US industries.
Treasury Secretary Steven Mnuchin is expected to push the plan this week, Bloomberg News reported.
"This one could well result in an escalating trade war," Lee Ferridge, a macro strategist at State Street Corp., told Bloomberg TV. "Volatility is going to continue to rise from here."
While some observers are saying Trump's moves are part of a negotiating tactic, he has shown no sign of backing down and on Friday threatened to impose a 20 percent tariff on cars imported from the European Union. That came just after the bloc imposed levies on US products, including bourbon, jeans and motorcycles.
Still, late Sunday he tweeted: "The United States is insisting that all countries that have placed artificial Trade Barriers and Tariffs on goods going into their country, remove those Barriers & Tariffs or be met with more than Reciprocity by the U.S.A. Trade must be fair and no longer a one way street!"
The People's Bank of China on Sunday said it would lower the amount of cash lenders must keep in reserve as it looks to soothe investors worried about a trade conflagration.
The cut -- which will free up more than $100 billion for banks -- is set to come into effect on July 5, the day before new US tariffs are due to be imposed on Chinese imports worth $34 billion.
While broad markets are taking another hit, energy firms in Asia were outperforming after OPEC agreed to increase oil production by around a million barrels a day from July.
But officials admitted actual output would likely be much lower as some countries' struggle to lift production.
Brent jumped more than three percent on Friday while WTI climbed more than four percent, though both contracts dipped Monday on concerns about the impact a trade war would have on demand.
Key figures around 0300 GMT
Tokyo - Nikkei 225: DOWN 0.4 percent at 22,434.06 (break)
Hong Kong - Hang Seng: DOWN 0.3 percent at 29,262.15
Shanghai - Composite: DOWN 0.2 percent at 2,885.20
Euro/dollar: DOWN at $1.1656 from $1.1658 at 2100 GMT on Friday
Pound/dollar: UP at $1.3261 from $1.3260
Dollar/yen: DOWN at 109.52 yen from 109.98 yen
Oil - West Texas Intermediate: DOWN 30 cents at $68.28 per barrel
Oil - Brent Crude: DOWN $1.54 at $74.01 per barrel
New York - Dow Jones: UP 0.5 percent at 24,580.89 (close)
London - FTSE 100: UP 1.7 percent at 7,682.27 (close)