By David Randall and Caroline Valetkevitch
NEW YORK (Reuters) - A comment by President Donald Trump that a deal to end the U.S.-China trade war might not come until after the November 2020 election weighed on global stock markets on Tuesday, sending investors to the safety of bonds.
Trump's saying the trade war may last another year came a day after his administration announced new tariffs on steel from Brazil and Argentina and threatened duties of up to 100% on French goods because of a digital services tax that Washington says harms U.S. tech companies.
All that appeared to dash hopes that an agreement with China could be reached before another round of U.S. tariff hikes kicks in on Dec. 15 and "triggered a lot of high-frequency traders to sell stocks," said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.
"But later on in the day, we saw buying come in," he said, since "the underlying fundamentals are still favorable." They include a potential re-acceleration in earnings growth, stable economic growth and low interest rates.
MSCI's gauge of stocks across the globe <.MIWD00000PUS> shed 0.6%.
On Wall Street, the Dow Jones Industrial Average <.DJI> fell 280.23 points, or 1.01%, to 27,502.81, the S&P 500 <.SPX> lost 20.67 points, or 0.66%, to 3,093.2 and the Nasdaq Composite <.IXIC> dropped 47.34 points, or 0.55%, to 8,520.64.
The S&P 500's session low was 3,070.33.
Europe appeared to be the next theater of the global trade war.
France said on Tuesday it was prepared to push the European Union to respond in kind if the United States followed through on its threats to raise tariffs.
Investors sought out bonds as a safe haven. The benchmark 10-year U.S. Treasury note's yield
German bond yields slipped from three-week highs
The safe-haven bid was in evidence on currency markets too, with the yen and Swiss franc rallying against the dollar.
In afternoon trading, the dollar fell 0.3% against the yen to 108.60 yen
In the energy market, Brent crude
(Reporting by David Randall and Caroline Valetkevitch; additional reporting by Gertrude Chavez-Dreyfuss and Ross Kerber; editing by Jonathan Oatis, Tom Brown and Dan Grebler)