Il Nuovo Postiglione - Stock markets fall as traders assess latest tariffs volley

Trump warned the previous day that he would impose tariffs "in the neighbourhood of 25 percent" on auto imports and a similar amount or higher on semiconductors and pharmaceuticals.

"Understandably this has helped drive European carmakers lower, with the likes of Mercedes-Benz, BMW and VW losing ground," said Joshua Mahony, chief market analyst at Scope Markets.

European markets all dropped, with London hit by higher-than-expected inflation figures.

Tariff threats also knocked auto firms and semiconductor makers in Tokyo, dragging the index into the red.

Trump's comments widened his trade war, having earlier pledged 25 percent levies on steel and aluminium.

While some observers have said that the threats are likely being used as a negotiating tool, it has nonetheless revived worries about the impact on the global economy.

"It remains to be seen which of the floated tariffs will be implemented but there are now many tariff spinning plates in play," said Deutsche Bank's Jim Reid.

China -- a key target in Trump's tariffs policy -- told the World Trade Organization on Tuesday that the US risked triggering inflation, market distortions and even a global recession.

The tariff threats added to market uncertainty since Europe and Kyiv were excluded from the first high-level talks between the US and Russia since the start of the war in Ukraine.

While all three main indexes on Wall Street rose on Tuesday, with the S&P 500 closing at a record high, Asia struggled to maintain momentum.

Hong Kong was dragged lower by tech firms after Chinese internet giant Baidu's fourth-quarter earnings saw a fall in revenue and a warning of near-term pressures.

The sector has helped the Hang Seng Index surge around 15 percent since the turn of the year, spurred by the emergence of Chinese startup DeepSeek's new chatbot that has upended the AI universe.

President Xi Jinping's meeting with China's top business leaders this week -- including Alibaba co-founder Jack Ma -- added to the optimism amid hopes of a fresh boost for the private sector.

The Shanghai stock market rose while Taipei was weighed by a sell-off in chip giant TSMC.

In other company news, Swiss mining and commodity trading giant Glencore dropped around seven percent on London's FTSE 100 after it reported a net loss for 2024.

Shares in Dutch medical device maker Philips dropped around 11 percent on the Amsterdam stock exchange, after it posted worse-than-expected losses.

Meanwhile Britain's BAE Systems profits, boosted by government defence spending, did not meet analysts' highest expectations, with shares dipping around one percent.

- Key figures around 1100 GMT -

London - FTSE 100: DOWN 0.4 percent at 8,733.61

Paris - CAC 40: DOWN 0.8 percent at 8,140.18

Frankfurt - DAX: DOWN 0.7 percent at 22,678.58

Tokyo - Nikkei 225: DOWN 0.3 percent at 39,164.61 (close)

Hong Kong - Hang Seng Index: DOWN 0.1 percent at 22,944.24 (close)

Shanghai - Composite: UP 0.8 percent at 3,351.54 (close)

New York - Dow: FLAT at 44,556.34 (close)

Euro/dollar: DOWN at $1.0432 from $1.0445 on Tuesday

Pound/dollar: DOWN at $1.2590 from $1.2608

Dollar/yen: DOWN at 151.80 from 152.09 yen

Euro/pound: UP at 82.87 pence from 82.85 pence

West Texas Intermediate: UP 0.6 percent at $72.29 per barrel

Brent North Sea Crude: UP 0.6 percent at $76.28 per barrel

A.Imbrogno--INP