World shares tumbled for a fourth day running on Thursday after a warning from U.S. President Donald Trump that a long-worked-on trade deal with China was in serious danger.
Europe’s main stock markets and Wall Street futures sank 0.5 to 1.3 percent after a torrid day for Asia saw more than 1.8 percent taken off China and more than 3 percent off South Korea, seen as the bellwether for the trade war.
Wall Street was expected to start 0.7-0.8 percent lower after a choppy day on Wednesday saw the Dow Jones nudge fractionally higher but the S&P 500 and Nasdaq drop 0.2 percent and 0.3 percent respectively.
In the currency market, the Japanese yen surged to a three-month high of 109.58 yen to the dollar before steadying, while China’s yuan fell half a percent to hit a four-month low of 6.838 and notch its biggest four-day drop in a year.
Turkey’s lira was taking blows again too, hitting an eight-month low as traders remained concerned about a decision to re-run Istanbul’s mayoral election.
Sterling, meanwhile, was trying to brush off concerns that Brexit talks between Britain’s government and the main opposition party may soon collapse to claw back above $1.30.
Commodity markets also felt the U.S.-China trade strains.
Brent crude futures dropped 0.6 percent to $69.92 a barrel, while U.S. West Texas Intermediate crude also retreated 0.6 percent to $61.75 despite a surprise fall in U.S. crude stockpiles.