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LONDON: World stock markets slid Thursday on fears that a growing crisis surrounding US President Donald Trump could lead to his impeachment and shatter any chances of his economy-boosting agenda being implemented.

The dollar recovered from a six-month low versus the euro, and clawed back ground against the yen, but not against the pound which was boosted by strong British retail sales.

"Stocks are sliding again today as traders are still spooked by the latest scandal surrounding Donald Trump," said David Madden, analyst at traders CMC Markets UK.

"Trump Dump!!," tweeted Mati Greenspan, Senior Markets analyst at eToro.

Europe's main stock markets were down by around one percent, with London underperforming its peers as the strengthening pound weighed on exporters.

Wall Street was 0.2 percent lower in early New York business, adding to Wednesday's sharp sell-off.

Safe haven asset gold kept near its best level in weeks. "Trump becomes gold's best friend," noted FXTM research analyst Lukman Otunuga.

- A pipe dream no more -

 

Global equities had already slumped Wednesday, with the Dow losing 1.8 percent and Frankfurt shedding 1.4 percent, while Tokyo followed suit earlier Thursday with a loss of 1.3 percent.

Investors tracked the heaviest losses in New York since Trump was elected Wednesday, following claims by recently fired FBI boss James Comey that the president pressed him to drop a probe into ex-national security advisor Michael Flynn's links to Moscow.

That came a day after it was reported Trump had divulged classified information to Russia's foreign minister, fanning further allegations about his own ties to the country's leaders.

While the tycoon says he will be exonerated by a newly appointed special prosecutor who will look into the claims, analysts said the uncertainty is rocking markets globally.

There is a growing fear that Trump's plans for tax cuts, big spending and red-tape slashing -- which had fuelled a global equities and dollar rally following his November election win -- will be thrown off course.

"It's all about President Trump," on markets, said Greg McKenna, chief market strategist at AxiTrader.

"Impeaching Donald Trump was a pipe dream for the Democrats but extremely unlikely to most other observers until a few days ago," he added. "As it drags on, it hurts sentiment and recently often threatens the administration's agenda -- especially around tax and infrastructure."

 

Copyright AFP (Agence France-Press), 2017
 

 

 

 

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