Investors dive for cover as Trump tariffs slam stocks

World stock markets and oil prices have tumbled and investors have dashed to the relative safety of bonds, gold and the yen as President Donald Trump's drastic US trade tariffs stirs widespread fears of a global recession.

A new baseline 10 per cent tariff on imported goods plus some eye-watering additional 'reciprocal' tariffs on countries Trump said put high trade barriers on the US, left traders clearly rattled.

In Europe, where the EU bloc faces a 20 per cent levy, bourses lurched between 1.3 per cent and 2.0 per cent lower early on Thursday as Brussels and other capitals were left in uproar.

Tokyo had slumped 2.7 per cent in Asia overnight to leave it on course for its worst week in nearly two years.

Wall Street futures were down three per cent, while the dollar dropped more that one per cent to a six-month low.

Analysts at JPMorgan said the tariffs were, "significantly higher than the realistic worst-case scenario" they have been envisaging.

Credit rating agency Fitch warned they were a "game-changer" for both the US and global economy, while Deutsche Bank called them a "once-in-a-lifetime" event that could easily knock between 1.0 per cent-1.5 per cent off US growth in 2025.

"Many countries will likely end up in a recession," Fitch's Olu Sonola said.

"You can throw most forecasts out the door if this tariff rate stays on for an extended period of time."

The scramble for ultra-safe government bonds that provide a guaranteed income drove US Treasury yields down towards four per cent and Germany's 10-year yield, the European benchmark borrowing rate, went 8.5 basis points lower to 2.64 per cent.

Nasdaq futures were down 3.2 per cent before what was expected to be a turbulent US restart.

Apple's market capitalisation had dropped by more than $US240 billion as its shares slid seven per cent in after-hours trade on Wednesday.

Nvidia's market cap dropped 5.6 per cent or $US153 billion, adding to the trillions wiped off the "Magnificent Seven" tech giants already in 2025.

Trump levies hit Asia particularly hard.

China was slapped with a 34 per cent levy, Japan got 24 per cent, South Korea 25 per cent and Vietnam 46 per cent.

Vietnamese stocks tumbled 6.7 per cent in response.

Australian shares and the Aussie dollar also fell as the country was hit, too.

Oil, a proxy for economic activity, dropped as much three per cent to put benchmark Brent futures back below $US73 a barrel and on course for its worst day of 2025 so far.

Gold hit a record high above $US3,160 an ounce before running out of steam, while Japan's yen jumped more than 1.5 per cent to 147.01 per dollar as foreign exchange traders looked for safety outside the US dollar.

The Swiss franc, another traditional safety play, touched its strongest level in four months as the euro jumped one per cent too to $US1.0970.

China held its currency relatively steady, containing the yuan's drop to about 0.4 per cent despite total tariffs of above 50 per cent on Chinese exports and the hit to Vietnam seen as shutting down a popular work-around route.

China's big domestic economy and the hope of support from Beijing limited losses in Hong Kong stocks to about 1.5 per cent and in Shanghai to about 0.5 per cent.