World shares slide as US-China trade dispute escalates

A woman walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong, Wednesday, April 4, 2018. Asian stock markets were mixed in early trading Wednesday as investors digested the latest volley of tariff measures and threats between the U.S. and China. (AP Photo/Kin Cheung)
A man walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong, Wednesday, April 4, 2018. Asian stock markets were mixed in early trading Wednesday as investors digested the latest volley of tariff measures and threats between the U.S. and China. (AP Photo/Kin Cheung)
A woman walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong, Wednesday, April 4, 2018. Asian stock markets were mixed in early trading Wednesday as investors digested the latest volley of tariff measures and threats between the U.S. and China. (AP Photo/Kin Cheung)

HONG KONG — Global shares fell sharply Wednesday after China announced a list of U.S. products that might be subject to a 25 percent tariff, in an escalation of trade tensions between the world's two biggest economies.

KEEPING SCORE: After a flat open, European markets fell sharply once the China tariffs were announced. Germany's DAX fell 1.1 percent to 11,867 while France's CAC 40 was down 0.7 percent at 5,114. The FTSE 100 index of leading British shares was 0.4 percent lower at 7,003. Wall Street was poised for big losses at the open with Dow futures and the broader S&P 500 futures 1.4 percent lower. The anticipated retreat at the open is set to wipe out Tuesday's gains.

TARIFF TENSIONS: Beijing and Washington detailed plans to hike tariffs on a broad swath of imported goods from each other, in a series of rapid fire announcements over less than 24 hours. China issued a $50 billion list of more than 100 U.S. goods including soybeans and aircraft targeted for a possible 25 percent tariff hike. Beijing was responding to an announcement hours earlier by President Donald Trump's administration outlining proposed tariffs on 1,300 imported Chinese products, including industrial robots and telecoms gear, to protest Beijing's alleged theft of U.S. technology. China's envoy to the WTO said Beijing would challenge the U.S. moves. The Chinese Commerce Ministry said the date the tariff hikes take effect depends on whether the U.S. actually moves to raise its duties.

ANALYST TAKE: "The losses more than wipe out Tuesday's rebound and set us on course for another worrying session driven by fears that a trade war between the world's two largest economies is heating up with neither side showing any sign of backing down," said Craig Erlam, senior market analyst at OANDA.

ASIAN SCORECARD: Most Asian indexes had closed when China announced its response to the U.S. tariff plans. Japan's benchmark Nikkei 225 crept 0.1 percent higher to end at 21,319.55 but South Korea's Kospi slid 1.4 percent to 2,408.06 as the won weakened from the 3 ½ year high it touched against the dollar earlier this week. The Shanghai Composite slipped 0.2 percent to 3,131.11 while Hong Kong's Hang Seng slumped 2.2 percent to 29,518.69 with the decline accelerating in the final minutes of trading after Beijing announced specifics of its tariff hikes.

CURRENCIES: The euro was flat at $1.2273 while the dollar fell 0.4 percent to 106.23 yen.

ENERGY: Oil's rally fizzled. A barrel of U.S. crude fell 92 cents to $62.59 a barrel on the New York Mercantile Exchange while Brent crude, used to price international oils, fell 82 cents to $67.30 a barrel in London.

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