BRUSSELS/FRANKFURT/PARIS (dpa-AFX) - European stocks look set to open sharply lower on Monday as an escalation in the tit-for-tat Sino-U.S. trade dispute over the weekend stoked global growth fears and sent investors scurrying to safe-haven assets such as sovereign bond, gold and the Japanese yen.
U.S. President Donald Trump raised tariffs on about $550 billion worth of Chinese goods by 5 percent on Friday after the Chinese Finance Ministry announced plans to impose an extra 10 percent tariffs on $75 billion worth of U.S. imports.
The U.S.-China trade dispute seems to have entered a new phase, as Trump demanded FedEx, UPS, Amazon and the Postal Service to 'immediately start looking for an alternative to China.'
At the G-7 summit over the weekend in France, Trump said he regrets not raising tariffs even higher, and added that he could declare the U.S.-China trade war a national emergency.
Asian markets sank, with benchmark indexes in Australia, New Zealand, China, Hong Kong, Japan and Kospi falling 1-3 percent.
Safe-haven assets such as the yen and gold rose on safe-haven demand and the offshore Chinese yuan hit a record low of 7.1858 against the dollar while oil prices fell around 1 percent to extend losses for a fourth day.
In economic releases, Germany's Ifo business sentiment survey results are due later in the day. The business confidence index is forecast to rise slightly to 96 in August from 95.7 in July.
U.S. stocks tumbled on Friday as trade tensions escalated and Fed Chair Jerome Powell reiterated during his prepared remarks in a widely anticipate speech in Jackson Hole, Wyoming, that the central bank will 'act as appropriate' to sustain the U.S. economic expansion.
The Dow Jones Industrial Average slumped 2.4 percent, the tech-heavy Nasdaq Composite lost 3 percent and the S&P 500 shed 2.6 percent.
European markets ended Friday's session sharply lower as worries heightened over Italy's mounting political crisis and Trump repeated public attacks on Federal Reserve Chairman Jerome Powell, questioning if Powell is a 'bigger enemy' than Chinese President Xi Jinping.
The pan European Stoxx 600 declined 0.8 percent. The German DAX gave up 1.2 percent, France's CAC 40 index shed 1.1 percent and the U.K.'s FTSE dropped half a percent.
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