Major global stock markets extended losses on Friday on heightened concerns over the potential fallout from US President Donald Trump’s tariff agenda.
US stocks slumped on opening with the NASDAQ falling 1.0 per cent and both the S&P and Dow dropping by 0.8 percent.
European indices likewise traded lower in mid afternoon deals following some heavy falls in Asia and weakness on Thursday on Wall Street.
London lost 0.7 per cent, Paris fell 1.0 per cent and Frankfurt suffered a 1.2 per cent drop.
“Overall, stocks are sliding because of a lack of confidence,” said Kathleen Brooks, research director at XTB trading group.
“There is a confidence deficit around the world, which has been triggered by the unorthodox economic policies of Donald Trump.”
Stock markets across the globe retreated on Thursday after the Federal Reserve painted a gloomier picture for the US economy in the near future, even if Federal Reserve boss Jerome Powell downplayed the impact of tariffs.
The Bank of England and Bank of Japan this week have warned about economic uncertainty fuelled by Trump.
“Equity investors are back focusing on the uncertainty and negative impact that is likely to come from a trade war,” National Australia Bank’s Rodrigo Catril noted on Friday.
“Sentiment remains fragile with investors nervous and not sure whether to put on risk or take it off.”
Shares in Hong Kong sank for a second day running after a blistering start to the year.
Chinese electric vehicle maker BYD dived more than eight percent following a report that the European Commission was conducting a foreign subsidy investigation into its plant in Hungary.
British Airways-owner IAG retreated more than two percent after the airline warned that the temporary closure of Heathrow airport, its main hub, would significantly affect operations.
Europe’s busiest airport shut down early on Friday after a fire at a nearby substation supplying power to the sprawling facility west of London.
“This will clearly have a significant impact on our operation and our customers and we’re working as quickly as possible to update them on their travel options for the next 24 hours and beyond,” British Airways said in a statement.
Nike slid 7.6 percent on Friday after the athletic footwear and apparel giant reported falling quarterly revenue.
Unease about the outlook continues to push gold prices higher as investors seek a safe haven from the volatility.
The precious metal was sitting just below the record $3,057.49 per ounce (28.35 grammes) touched on Thursday.
“While much ink has been spilled linking the latest leg up in the price over the last month to the US growth scare, it is notable that gold has historically had a mixed record around US recessions,” said Kieran Tompkins, senior climate and commodities economist at Capital Economics.
Oil prices dropped despite rising tensions in the crude-rich Middle East.
Gold prices fall: Gold fell over 1% on Friday due to a stronger dollar and profit-taking, although lingering geopolitical and economic uncertainties, and US Federal Reserve rate cut prospects kept bullion on track for a third consecutive weekly rise.
Spot gold was down 1.4% at $3,001.03 an ounce at 10:17 a.m. ET (1457 GMT). US gold futures fell 1.2% to $3,007.80. Bullion has gained 0.7% so far this week.
Gold, traditionally viewed as a safe-haven investment during times of geopolitical and economic uncertainty, and typically thriving in a low-interest rate environment, has hit 16 record highs this year, reaching an all-time peak of $3,057.21 per ounce on Thursday.
The US dollar rose 0.2%, hitting a two-week high and making greenback-priced bullion more expensive for overseas buyers.
US President Donald Trump still intends for new reciprocal tariff rates to take effect on April 2.
The Fed held its benchmark interest rate steady on Wednesday as widely expected, but indicated two quarter-percentage-point cuts before the end of the year.
Traders are pricing in 71 basis points of easing this year from the Fed with at least two rate reductions of 25 bps each, with a cut in July fully priced in, LSEG data showed.
Israel announced an escalation in air, land, and sea strikes against Hamas in Gaza to pressure the release of remaining hostages, effectively abandoning a two-month ceasefire and launching an all-out air and ground campaign against the dominant Palestinian militant group.
Spot silver slid 2.2% to $32.80 an ounce, platinum lost 1.3% to $972.25 and palladium was steady at $952.04. All three metals were poised for weekly losses.