London (AFP) - Global stock markets mostly fell Wednesday after US President Donald Trump broadened his tariff threats, stoking wider trade war fears.

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.

Shares in US carmaker GM fell but Ford managed a small gain.

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.

Wall Street’s main three indices slid lower, with the S&P 500 hanging just below the all-time high that it set at the close of trading on Tuesday.

Concerns that share valuations may be too high may also be part of the reason for the retreat in equities along with a rise in Treasury yields, noted Briefing.com analyst Patrick O’Hare.

China – a key target in Trump’s tariffs policy – told the World Trade Organization on Tuesday that the United States 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.

Frankfurt’s DAX 40 index set another record high during morning trading, but broke a two-week winning streak as investors have looked forward to a business-friendly government following Sunday’s election.

“The uncertainty surrounding the election is likely to negatively impact short-term price developments,” said CMC Markets analyst Konstantin Oldenburger.

Asian markets struggled for direction, with 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 more than six percent on London’s FTSE 100 after it reported a net loss for 2024.

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

- Key figures around 1630 GMT -

New York - Dow: DOWN 0.3 percent at 44,428.59 points

New York - S&P 500: DOWN less than 0.1 percent at 6,126.71

New York - Nasdaq Composite: DOWN 0.1 percent at 20,016.10

London - FTSE 100: DOWN 0.6 percent at 8,712.53 (close)

Paris - CAC 40: DOWN 1.2 percent at 8,110.54 (close)

Frankfurt - DAX: DOWN 1.8 percent at 22,433.63 (close)

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)

Euro/dollar: DOWN at $1.0407 from $1.0445 on Tuesday

Pound/dollar: DOWN at $1.2572 from $1.2608

Dollar/yen: DOWN at 151.61 from 152.09 yen

Euro/pound: DOWN at 82.78 pence from 82.85 pence

West Texas Intermediate: UP 0.9 percent at $72.47 per barrel

Brent North Sea Crude: UP 0.7 percent at $76.40 per barrel

burs-rl/cw