Dubai Telegraph - Stock markets tumble as Trump targets booze

Worries about a potential US government shutdown by the weekend also worried investors, while Russian President Vladimir Putin's limited backing of a possible ceasefire in Ukraine failed to boost sentiment.

Trump threatened Thursday to impose 200 percent tariffs on wine, champagne and other alcoholic products from France and other European Union countries in retaliation against the bloc's planned levies on US-produced whiskey, part of the EU's reprisals for US tariffs on steel and aluminum imports.

"President Trump's threat of more tariffs, this time a 200 percent tariff on alcoholic beverages from the EU, has led to the resumption of the... sell-off in global stock indices," said analyst Axel Rudolph at online trading platform IG.

Trump has launched trade wars against competitors and partners alike since taking office, wielding tariffs as a tool to pressure countries on commerce and other policy issues.

Shares in luxury giant LVMH, which owns several champagne houses including Dom Perignon and Hennessy cognac, slid 1.1 percent.

Shares in French drinks group Pernod Ricard, which owns two champagne houses and Jameson Irish Whiskey, tumbled about four percent.

The Paris stock exchange finished the day down 0.6 percent and Frankfurt shed 0.5 percent. London ended the day flat.

Wall Street's three main indices finished the day down sharply.

The S&P 500 Index tumbled into a technical correction, or down 10 percent from its highest point of the year, recorded just last month.

CFRA Research chief investment strategist Sam Stovall told AFP that the correction stemmed from "the tariff threats and the uncertainty surrounding retribution, (and) surrounding the possibility of recession as a result."

"The only problem is we don't know exactly how long it will go," Stovall said.

The drop came despite data showing US producer inflation was flat in February, defying expectations of an uptick as Trump's tariff hikes targeting Chinese goods took effect.

"That's pretty good news in terms of inflation but the problem is, you have a trade war that's expanding," said Peter Cardillo of Spartan Capital Securities.

Gold, seen as a safe haven, struck an all-time high of $2,988.54 per ounce, surpassing its late February record.

Trump's tariffs and pledges to slash taxes, regulations and immigration have sparked market volatility and concerns that the measures could reignite inflation.

That in turn could force the US Federal Reserve to lift interest rates again, potentially causing a recession.

Traders were also waiting on a decision from Russia on whether to mirror Ukraine's acceptance of a 30-day ceasefire as proposed by the United States.

Putin appeared to condition a 30-day ceasefire that the Trump administration has been pushing on Russian troops ejecting Ukrainian forces from Russia's Kursk region.

- Key figures around 2100 GMT -

New York - Dow: DOWN 1.3 percent at 40,813.57 points (close)

New York - S&P 500: DOWN 1.4 percent at 5,521.52 (close)

New York - Nasdaq Composite: DOWN 1.96 percent at 17,303.01 (close)

London - FTSE 100: FLAT at 8,542.56 (close)

Paris - CAC 40: DOWN 0.6 percent at 7,938.21 (close)

Frankfurt - DAX: DOWN 0.5 percent at 22,567.14 (close)

Tokyo - Nikkei 225: DOWN 0.1 percent at 36,790.03 (close)

Hong Kong - Hang Seng Index: DOWN 0.6 percent at 23,462.65 (close)

Shanghai - Composite: DOWN 0.4 percent at 3,358.73 (close)

Euro/dollar: DOWN at $1.0849 from $1.0890 on Wednesday

Pound/dollar: DOWN at $1.2948 from $1.2969

Dollar/yen: DOWN at 147.75 yen from 148.32 yen

Euro/pound: DOWN at 83.75 pence from 83.97 pence

West Texas Intermediate: DOWN 1.67 percent at $66.55 per barrel

Brent North Sea Crude: DOWN 1.51 percent at $69.88 per barrel

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V.Munir--DT