World stock markets rose and the euro climbed to a three-week peak yesterday as the threat of tariffs by the United States and China on billions of dollars of trade became a reality, though concerns about the conflict escalating capped the appetite for risk.

MSCI’s measure of world equities markets rose 0.4 per cent to the highest level in a week, while Asian stocks climbed nearly half a per cent, led by a rebound in Chinese shares.

Stocks dipped broadly in Europe, with the pan-European FTSEurofirst 300 index lost 0.28 per cent. US equities edged higher in morning trade after monthly jobs data showing a 213,000 gain in non-farm payrolls in June and stable wage growth.

The Dow Jones Industrial Average fell 3.69 points, or 0.02 per cent, to 24,353.05, the S&P 500 gained 7.6 points, or 0.28 per cent, to 2,744.21 and the Nasdaq Composite added 41.21 points, or 0.54 per cent, to 7,627.64.

“The trade headlines are at this point keeping the market uncertain,” said Quincy Krosby, the chief market strategist at Prudential Financial.

Signs of nervousness about the trade outlook were evident elsewhere in global markets, with the Japanese yen and the Swiss franc firm against the dollar while core United States and German bonds were in demand.

Benchmark 10-year Treasury notes last rose 7/32 in price to yield 2.8145 per cent, from 2.84 per cent late on Thursday.

The latest flows data confirmed that trend. Investors have pulled money out of emerging markets and European equities more quickly over the last two months than in 2016, Bank of America Merrill Lynch strategists said yesterday in a weekly note.

The US and China slapped tit-for-tat duties on $34 billion worth of each other’s imports yesterday, with Beijing accusing Washington of triggering the “largest-scale trade war” as the world’s two biggest economies sharply escalated their conflict.

United States President Donald Trump has warned that the country may ultimately target over $500 billion worth of Chinese goods, an amount that roughly matches its total imports from China last year.

Copper, seen as a barometer of the world’s economic strength because of its wide industrial use, on Friday fell to near a one-year low, at $6,221.50 per tonne, before recouping some losses.

US crude rose 0.51 per cent to $73.31 per barrel, and Brent was last at $76.96, down 0.56 per cent on the day.

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