Markets catch sparks fanned by raging trade war

EQUITY markets tumbled yesterday after Donald Trump delivered a "shock and awe" tariff on steel imports, fanning a global trade war that many fear will spark recessionary ramp inflation.

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Tokyo, Nikkei, easily collapsed more than four percent, while US futures plunged with oil prices, safe dollar regained a recovery and US gold retreated amid worries retaliatory measures will batter economies.

The panic came after the US president unveiled a blitz of harsher-than-expected levies aimed at countries he said had been "ripping off" the US for decades.

Against a backdrop of US flags, Trump said that for decades, countries had cheated, pillaged, raped and plundered by nations near and far, both friend and foe alike.

The measures included a 34% tariff on civil rims, 20% on key ally the EU and 24% on Japan.

A number of others will face specifically tailored tariffs, and for the rest, Trump said he would impose a "baseline" tariff of 10%. Auto tariffs of 25% meanwhile kicked in yesterday.

Investors are bracing for retaliatory measures, with governments making their anger clear.

China vowed "countermeasures" and urged Washington to cancel the tariffs, while calling for dialogue.