Hilary Benn said there was less disorder on the streets of Belfast on Wednesday night as opposed to Tuesday, when rioters targeted ethnic minorities and foreign residents by torching homes and vehicles following a knife attack for which a Sudanese man has been charged with attempted murder.
But many of those who did clash with police on Wednesday were seeking to get to a hotel outside Belfast that has been targeted in the past for housing asylum seekers.
Officers used water cannon to drive rioters back and Reuters saw what appeared to be plastic bullets, or baton rounds, on the street.
The Police Service of Northern Ireland declined to comment.
Asked on Sky News on Thursday if violent scenes were racist riots rather than protests, he said: "Well, if you are targeting people on the basis of the colour of their skin, how else can you describe them? That is racist thuggery."
Police and politicians say much of the violence had been encouraged and co-ordinated online.
In recent days lists have circulated showing where asylum seekers were living, the addresses of immigration businesses were published and a nursing union official said ethnic minority nurses had been chased by masked men as they tried to get to work.
Kate Nicholl, a politician in the Northern Ireland assembly, said police were patrolling areas that had been named in a "hit list".
Benn said the violence had caused deep trauma in the province.
"It's really difficult to convey the genuine sense of fear there is on the part of the ethnic minority community here in Northern Ireland as they've witnessed these scenes, reports of people being stopped in their cars to be asked what their nationality is, nurses going to work," he said.
"This is appalling."
For some in Northern Ireland, the unrest has brought back memories of the "Troubles", three decades of violence between mainly Catholic Irish nationalists and predominantly Protestant pro-British "loyalists".
The original knife attack in Belfast on Monday night, which is not being treated as terrorism, comes at a time of heightened tensions in Britain over crime and immigration, with populist parties saying Britain's asylum policy had allowed dangerous men into the country.
Tech billionaire Elon Musk has reposted many messages on his X platform denouncing the state of the United Kingdom following the Belfast incident, including reposting the leader of Britain's Restore political party which wants to deport hundreds of thousands of people from Britain.
Northern Ireland has now been gripped by anti-immigration violence for three summers in a row.
During the past two nights rioters have burnt houses, smashed windows, hurled bricks at police and marched down streets saying they were there to get "foreigners out".
"This kind of thuggery cannot continue," Benn told Times Radio.
"I only hope that the fact that we saw less disorder last night is because some people have reflected on the truly shocking scenes that we saw on Tuesday."
with PA
