Asian shares were trading mixed Wednesday as markets mulled the impact of tariffs being imposed by the United States and China. The Hang Seng dropped 1.2% to 20,543.93, while the Shanghai Composite lost 0.

The German and French stock markets were down about 2%, and London's FTSE 100 dropped more 1%, according to the British Broadcasting Corporation. However, the U.S. dollar strengthened on the currency markets as the Canadian dollar plunged to its lowest level since 2003, the BBC also reports.

Investors are bracing for a potential trade war that could hit the earnings of major companies and dent global growth. Canada and Mexico have said that they will hit back with retaliatory tariffs while China promised to respond with "corresponding countermeasures" and vowed to challenge Trump's move at the World Trade Organization.

Asia shares mostly fell in Monday trading as worries grow about President Donald Trump imposing tariffs on key U.S. trading partners. Japan’s benchmark Nikkei 225 lost 2.4% in

Asian stocks plunge as Trump’s tariffs spook markets Stock markets in Asia dropped on Monday after US tariffs on China, Canada and Mexico triggered fears of a hit to global growth. Japan's Nikkei index tumbled as much as 2.