The trade standoff is spooking investors

London (AFP) - European stock markets were under pressure Thursday from intensifying concerns about the impact of an all-out global trade war between China and the United States.

Beijing said Wednesday it would impose 25 percent tariffs on $16 billion of US goods from August 23, retaliating in kind to a warning from US officials the day before and escalating a crisis that pits the world’s top two economies against each other.

“Investors are still wondering how quickly, if at all, the tariffs so far will start to affect companies and then economies,” IG analyst Chris Beauchamp told AFP.

“We know the theory, but the actual developments will take time to become clear.”

- ‘Market resilience’ -

“It is also not yet clear how far (the trade war) will run – until the mid-term (US elections in November)? Or further until (President Donald Trump) can really get some key concessions from China,” pondered Beauchamp.

“Market resilience over the past few weeks suggests investors have calmed down for the time being, at least where US equities are concerned.”

Asian stocks largely brushed off China’s tit-for-tat response, with most markets rising on Thursday.

Wall Street also appeared unimpressed with the latest trade spat twist, with the Dow opening unchanged, and the S&P 500 index only a touch weaker.

But in Europe the mood was gloomy, with the London and Paris stock markets lower, while Frankfurt managed small gains.

- Ruble dives -

The Russian ruble, meanwhile, tumbled after Washington slapped Russia with new sanctions over Moscow’s alleged involvement in a nerve agent attack in Britain.

The Kremlin slammed as “unacceptable” the fresh US sanctions which analysts said probably had little connection with the trade wars Washington is waging with key trade partners.

“I don’t think the Russia move is another front in the (trade) war,” said Beauchamp, “since Russia is the United States’ 23rd largest partner, and thus not very high on the list”.

Among other emerging market currencies the Turkish lira hit new lows against the dollar as high-level talks between Ankara and Washington to defuse tensions produced no apparent breakthrough.

The battered lira has lost over 40 percent of its value this year.

The British pound, meanwhile, remained rooted near one-year lows on fears Britain will leave the European Union next year with no deal to trade with the bloc.

“The market is clearly getting more nervous over the possibility of a no-deal Brexit, which would be a messy outcome for the UK economy,” said Rodrigo Catril, senior foreign exchange strategist at National Australia Bank.

- Key figures at 1330 GMT -

London - FTSE 100: DOWN 0.5 percent at 7,737.85 points

Frankfurt - DAX 30: UP 0.4 percent at 12,679.93

Paris - CAC 40: DOWN 0.2 percent at 5,496.02

EURO STOXX 50: FLAT at 3,493.01

New York - Dow Jones: FLAT at 25,585.71

Tokyo - Nikkei 225: DOWN 0.2 percent at 22,598.39 (close)

Hong Kong - Hang Seng: UP 0.9 percent at 28,607.30 (close)

Shanghai - Composite: UP 1.8 percent at 2,794.38 (close)

Euro/dollar: DOWN at $1.1591 from $1.1610 at 2100 GMT

Pound/dollar: UP at $1.2888 from $1.2882

Dollar/yen: UP at 111.00 yen from 110.98 yen

Oil - Brent Crude: UP eight cents at $72.36 per barrel

Oil - West Texas Intermediate: DOWN two cents at $66.92