NEW YORK/LONDON: US stock indexes tumbled on Thursday, with heavyweight technology stocks suffering big losses, as President Donald Trump’s sweeping tariffs on major trade partners ignited fears of an all-out trade war and heightened the risk of a global economic recession.

Apple sank 8 percent, reeling from the impact of an aggregate 54 percent tariff on China, which is the base for much of the iPhone maker’s manufacturing. Microsoft dropped 3 percent and Nvidia slumped 5.6 percent. At 09,40 am ET, the benchmark S&P 500 dropped 3.1 percent, while the Nasdaq Composite fell 4.27 percent - with both indexes trading at a near seven-month low. The Dow Jones Industrial Average shed 2.6 percent.

Global stocks slumped, government bonds jumped and safe-haven gold touched a record high as Trump slapped a 10 percent tariff on most goods imported to the United States and much higher levies on dozens of rivals. “This was the first bullet thrown in this trade war and it could get nasty and that is spooking investors. We’re going to continue to trade on a heavy tone because of the heightened risk of either recession or stagflation,” said Elias Haddad, senior markets strategist at Brown Brothers Harriman. “We could see the correction bottom out when we have firm evidence that we’re not falling into recession.”

The dollar slumped by as much as 2.6 percent versus the euro, its biggest intraday plunge in a decade, and suffered sharp losses also against the yen and British pound.

“The simultaneous decline in both stocks and the US dollar speaks volumes about investor confidence in Trump’s trade policy,” said City Index analyst Fawad Razaqzada. Shares in apparel companies, which rely on cheap labor in factories abroad, with Nike sinking 11 percent and Gap shedding 15 percent. Across the globe shares in major sectors including auto, luxury and banking, also took big hits. Tokyo’s Nikkei briefly collapsed more than four percent and the Paris stock market led losses in Europe as it fell over three percent.

Oil prices plunge

Oil prices plummeted around seven percent to under $70 per barrel as an economic downturn would hit demand. Gold, a safe haven asset in times of uncertainty, hit a new peak of $3,167.84 an ounce.

Yields on government bonds, another haven investment, fell as investors fled risky assets.

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 United States for years. The measures included a 34 percent tariff on world number two economy China, 20 percent on the European Union and 24 percent on Japan. A number of others will face specifically tailored tariff levels, and for the rest, Trump said he would impose a “baseline” tariff of 10 percent, including on Britain.

The tariffs, poised to disrupt the global trade order and unsettle businesses, highlight a stark shift from just a few months ago when the promise of business-friendly policies under the Trump administration propelled US stocks to record highs. — Agencies