In European Equity Markets the pan-European STOXX 600 closed down more 1.74%. All sectors and major bourses were in negative territory, with the French CAC index recorded a 2% loss. Europe’s autos sector, heavily exposed to China, saw a sharp downturn on Thursday, trading 2.96% lower on the back of intensified U.S.-Sino trade frictions. German automotive supplier Continental’s stock fell 5.5%, while auto parts supplier Hella’s shares were down 5% as the sector came under pressure.

In Currency Markets the Japanese yen rose to a three-month high against the dollar on Thursday, with the Swiss franc at a one-month high as investors sought out the safe-haven currencies, fearing the U.S.-China trade conflict will escalate. The yen was more than half a percent stronger in mid-morning trade, last at 109.53 to the dollar, the fewest since Feb. 4. The dollar bought 1.013 Swiss francs on Thursday, the weakest against that currency since April 18. The dollar index was 0.37% lower, last at 97.263. The yuan fell 0.75% to a four-month low of 6.858.

In Commodities Markets oil prices fell on Thursday, reversing earlier gains, as an escalating trade battle between the United States and China counteracted upward pressure from a surprise decline in U.S. crude inventories. Heightened tensions between the world’s two biggest economies have clouded the outlook for global growth, which influences oil demand expectations. Brent crude oil futures were at $70.01 a barrel, down 36 cents from their previous settlement and heading for their second consecutive weekly loss. U.S. WTI crude futures were at $61.64 per barrel, down 48 cents.

In US Equity Markets indices  fell more than 1 percent on Thursday, as tensions heated up ahead of a make-or-break U.S.-China trade meeting, which could lead to a prolonged dispute that would threaten global financial markets and economic growth. The S&P 500 was down 1.19%, at 2,845.02 and the Nasdaq Composite fell 1.47%, at 7,826.51. In a bright spot, Tapestry Inc jumped 10.6%, the most among S&P companies, after the Coach handbag maker beat quarterly profit estimates and announced a $1 billion share buyback plan.

In Bond Markets investors hoovered up Irish and Spanish debt through bond sales and in the open market on Thursday, underlining how the two countries are moving away from the “periphery”, a phrase used to describe lower-rated and more volatile euro zone bond markets. Ireland raised 4 billion euros from a syndicated sale of a new 2050 bond, after investors swamped the book with demand for 4.5 times that amount. Italian 10-year bond yields were up 6 bps in late trade at 2.67 percent, while the Italy/Germany bond yield gap was at 271 bps.