Markets fret over trade war after Trump's tariff vow

LONDON (AP) - Global stock markets fell sharply Friday as investors fretted over a trade war following U.S. President Donald Trump's vow to impose stiff steel and aluminum tariffs.

KEEPING SCORE: In Europe, Germany's DAX fell 2.2 percent to 11,917 while the CAC 40 in France fell 1.9 percent to 5,161. The FTSE 100 index of leading British shares was 1 percent lower at 7,101. U.S. stocks were poised for further losses at the bell with Dow futures and the broader S&P 500 futures down 1 percent.

TARIFF FEARS: In his latest move to follow through on campaign promises of an "America First" trade policy, Trump told industry executives he planned to levy penalties of 25 percent on imported steel and 10 percent on aluminum imports. He said the tariffs would be in place for "a long period of time," though it wasn't immediately clear if certain trading partners would be exempt. The comments renewed investor concerns that increasingly nationalistic governments will impose barriers hurting the global economy and trade.

ANALYST TAKE: "While Donald Trump considers himself pro-business, the imposition of tariffs across the aluminum and steel sector has led to fears over a collapse in global trade," said Joshua Mahony, market analyst at IG. "The threat of a trade war was always likely to hit the export driven German economy hardest."

CHINA SESSION: Also on investors' radar is next week's annual session of China's National People's Congress. The meeting of the rubber-stamp parliament's 3,000-plus delegates is mainly ceremonial but China's Communist leaders use it to publicize new initiatives and set the tone for the year's development plans. Investors will be looking to see whether Beijing brings in painful reforms to curb surging debt and overhaul state industry while widening the economy to private competitors.

WEEK AHEAD: Other risk events for the markets include elections and central bank meetings. Italians go to the polls on Sunday in a vote in which the main contenders include parties supporting anti-European, anti-immigration and populist positions. Policymakers at central banks in Europe, Australia, Canada and Japan are set to hold scheduled meetings, though no big changes are expected.

ASIAN SCORECARD: Japan's benchmark Nikkei 225 lost 2.2 percent to close at 21,181.64 and South Korea's Kospi slid 1 percent to end at 2,402.16. Hong Kong's Hang Seng shed 1.5 percent to 30,583.45 and the Shanghai Composite in mainland China fell 0.6 percent to 3,254.53. Australia's S&P/ASX 200 sank 0.7 percent to 5,929.90.

CURRENCIES: The euro rose 0.4 percent to $1.2316 while the dollar slipped 0.8 percent to 105.34 yen.

ENERGY: Benchmark U.S. crude dipped 41 cents to $60.58 a barrel in electronic trading on the New York Mercantile Exchange, while Brent crude, the international standard, slipped 42 cents to $63.41 a barrel.