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Global Markets: Shares stumble on fresh fears about global growth, trade

Reuters  |  NEW YORK 

By Lewis Krauskopf

(Reuters) - Stocks pulled back sharply around the world on Thursday on fears of a global growth slowdown spreading to and worry about the chances for a resolution of U.S.-trade tensions anytime soon, while the U.S. dollar strengthened for a sixth session against a basket of currencies.

MSCI's gauge of stocks across the globe shed 0.98 percent as it receded from two-month highs reached earlier in the week. The pan-European 600 index lost 1.49 percent after disappointing corporate updates from and other companies, while Wall Street's S&P 500 benchmark index dropped 0.9 percent.

The sharply cut its forecasts for zone economic growth this year and next on expectations the bloc's largest countries will be held back by global trade tensions and domestic challenges. Germany's DAX stock index tumbled 2.7 percent as industrial output in Europe's biggest unexpectedly fell in December for the fourth consecutive month.

Safe-haven assets gained, including Japan's yen and gold.

"Even though we are in the midst of earnings season, the macro environment is really impacting global risk sentiment," said Katie Nixon, at in

"Fears of a more dramatic slowdown in are being joined with the fears around a slowdown in And the broad slowdown in global trade is having a direct impact on some of these economies and some of the results."

Heightened concerns about U.S.-trade relations also rattled investors after said he did not plan to meet with Chinese before a March 1 deadline to achieve a trade deal.

"Any concern that the stalemate won't be overcome by China and the U.S. is going to create negative sentiment for the markets just because trade is the single largest overhang," said Mike Loewengart, vice-of investment strategy at in

On Wall Street, the Dow Jones Industrial Average fell 220.77 points, or 0.87 percent, to 25,169.53, the S&P 500 lost 25.56 points, or 0.94 percent, to 2,706.05 and the Nasdaq Composite dropped 86.93 points, or 1.18 percent, to 7,288.35.

U.S. regional lender will buy rival for about $28 billion in stock, the biggest in about a decade. Shares of both banks rose.

The downgrade in European growth expectations filtered into currency markets, with the down 0.14 percent to $1.1344.

The dollar index, which weighs the greenback against a basket of six currencies, rose 0.15 percent, firming for a sixth session in a row.

yields fell for a third straight session. Benchmark U.S. 10-year notes last rose 13/32 in price to yield 2.659 percent, from 2.704 percent late on Wednesday.

Oil fell as the market confronted concerns that global demand growth would lag in the coming year.

U.S. crude settled down 2.5 percent to $52.64 a barrel, while Brent settled at $61.63 a barrel, down 1.7 percent.

(Additional reporting by in Bengaluru; Editing by Dan Grebler, and Sonya Hepinstall)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, February 08 2019. 02:52 IST