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Wall Street and European stock markets followed Asian shares lower on Tuesday, as investors around the world took fright at the increasingly fractious global geopolitical outlook.

Investors are growing increasingly worried about a cocktail of risks that could act as a significant drag on the world economy. Potential headwinds include the trade dispute between the US and China, rising US interest rates, the fallout from the death of the Saudi journalist Jamal Khashoggi and the budget dispute between the EU and Italy.

Oliver Jones, a markets economist at the research firm Capital Economics, said: “Worries about problems in the US, and to some extent in the past few days China, have proved contagious.”

The Dow Jones Industrial Average of leading US companies dropped by more than 500 points in early New York trading on Tuesday, as the global sell-off that began earlier this month gathered pace. The Dow later recovered but was still about 250 points, or 1%, down by 1900 BST.

European stock markets also fell sharply, with the UK’s FTSE 100 sliding more than 90 points to close below 7,000, ending the day at a seven-month low after another jittery trading session. The leading German stock index dropped by more than 2% and the biggest French companies shed almost 1.7% of their value.  Read More

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