Stock markets fall around the world as trade war fears increase

The Dow Jones slipped 0.6 per cent while the S&P 500 was 0.4 per cent lower

The Cac 40 in France fell 0.93 per cent on the day while Germany’s Dax dropped 1.36 per cent (Getty/iStock)

Stock markets around the world fell on Monday as fears gathered over a worsening outlook for global trade.

The Cac 40 in France fell 0.93 per cent on the day while Germany’s Dax dropped 1.36 per cent to 12,834, partly due to fears over the future of Angela Merkel’s government.

The FTSE 100 managed to make back its early losses to finish almost flat by the end of the day.

The Dow Jones slipped 0.6 per cent while the S&P 500 was 0.4 per cent lower by early afternoon in New York.

Earlier, the Nikkei fell 0.75 per cent in Tokyo while the South Korean stock market fell 1.1 per cent and other Asian shares also declined

US President Donald Trump has slapped billions of pounds worth of tariffs on a range of Chinese goods as well as on imports of steel aluminium from a number of countries.

The action provoked swift retaliation from China and the EU, sparking fears of a potentially damaging trade war.

The pound fell 0.26 per cent against the dollar to 1.324 after data pointed to a cooling in UK house prices. Sterling was flat against the euro.

The UK currency has lost around 8 per cent of its value against the dollar in the last two months as a series of weak economic indicators have decreased the likelihood of an imminent interest rate raise by the Bank of England.

Oil prices surged on Monday ahead of a meeting of the Organisation of the Petroleum Exporting Countries (Opec).

Brent crude was up 2 per cent to $74.45, towards the end of the session,

The jump came after news that Venezuela has started shutting down oil production.