EMERGING MARKETS-Asian stocks slip as trade war concerns intensify after Trump steel tariffs

By Roshan Thomas

June 2 (Reuters) - Equities in Asia retreated on Monday, with shares in South Korean and Vietnamese steelmakers dropping after U.S. President Donald Trump said he would double tariffs on imported steel and aluminium to 50%.

Trading volumes were thinner overall due to a public holiday in the region, with markets in China, Thailand and Malaysia closed.

Trump's announcement late on Friday intensified a global trade war and came just hours after he accused China of violating an agreement to mutually roll back tariffs for critical minerals.

Shares in Seoul .KS11 fell 0.2% on Monday, with steelmakers POSCO and Hyundai Steel falling 3% and SeAH Steel Corp 306200.KS down as much as 12.6%.

In Vietnam, major steelmaker Hoa Sen Group HSG.HM fell 5.8%.

Investors were cautious as markets digested tariff uncertainty and geopolitical risk, including from the latest developments in Ukraine and Russia, according to Junvum Kim, sales trader at Saxo Capital Markets.

Ukraine's overnight drone strikes hit Russia’s Kursk and Voronezh regions triggering residential fires and disrupting traffic.

Leading the decline, shares in Taipei .TWII and Jakarta .JSKE fell 1.7% each, while those in Singapore .STI and Mumbai .NSEI slipped 0.5% and 0.8%, respectively.

Indonesia's benchmark index emerged as the best performer regionally in May, adding over 6%, and Monday's trading could be due to profit taking, Fakhrul Fulvian, an economist at Trimegah Securities said.

Data showed Indonesia's annual inflation rate at 1.60% in May, slowing more sharply than expected.

Currencies in the region were largely steady, with the South Korean won KRW=KFTC advancing 0.5% and the Indian rupee INR=IN adding 0.2%. The Taiwanese dollar TWD=TP, however, lost 0.3%.

The U.S. dollar =USD declined 0.2% on Monday as mounting fiscal concerns and a broad "Sell America" wave continued to weigh on U.S. assets from stocks to Treasuries. USD/

"In the ASEAN region, we expect the currencies to further appreciate this year as global investors spread their holdings more widely after years of heavy U.S. positioning," Maybank analysts said in a research note.

On Tuesday, South Koreans go to the polls in a snap presidential election to replace Yoon Suk Yeol, who was ousted from office in April after his brief martial law attempt sent shockwaves through the country.

Investors are also awaiting inflation figures from Taiwan, South Korea and Philippines later this week.

HIGHLIGHTS:

Indonesia's trade surplus shrinks to lowest in 5 years

Trump, Xi likely to speak soon on minerals trade dispute, aides say

Markets in Thailand, Malaysia and China were closed for a public holiday