Global Markets: Stocks fall further after Trump's China tariff threat

World stocks pulled back further on Friday on grim US economic data, mixed company results and President Donald Trump's threat to impose new tariffs on China over the coronavirus crisis.

MSCI's index of global stocks fell 0.5 percent after a tumble late Thursday broke a six-day winning streak for the index.

London-listed stocks fell as data showed the UK housing market was grinding to a halt, with the FTSE 100 down 2.2 percent, wiping out much of the strong gains earlier in the week.

British Airways operator IAG shed another 2.6 percent as details of its plans to cut staffing, including a quarter of its pilots, to weather the collapse in air travel caused by the coronavirus.

Trading volumes were thin with many European markets closed for a May 1 public holiday.

In Asia, with many markets closed, the benchmark Nikkei index fell 2.8 percent, with declines led by chipmaking firms. Australian shares fell 5 percent, their most in five weeks.

The negative sentiment was set by comments from Trump on Thursday that he was concerned about China's role in the origin and spread of the novel coronavirus and that his hard-fought trade deal with China was now of secondary importance to the pandemic. He threatened new tariffs on Beijing, as his administration crafted retaliatory measures over the outbreak.

Meanwhile, US initial jobless claims totalled 3.84 million for the week ended April 25 and personal spending tumbled 7.5 percent in March, the biggest decline on record. All that came a day after figures showed the biggest quarterly contraction for the US economy since the Great Recession.

The US Federal Reserve widened a key program to help the economy, agreeing to lend to even larger firms, bringing the dollar under some selling pressure. The currency, which has so far been remarkably resilient, fell to two-week lows and is set for a 2 percent weekly loss. It has steadied somewhat this morning, however.

The dollar was down slightly against the Japanese yen, trading at 107.07 yen, though another metric of distress in the markets -- the Australian dollar -- fell by 1 percent to 0.6447, its weakest since Tuesday.

Oil prices rose, helped by major producers starting output cuts to offset a slump in fuel demand and by data showing US crude inventories expanded less than expected.

Brent crude for July delivery, was up 22 cents, or 0.8 percent, at $26.70 a barrel, after rising about 11 percent in April. It has still slumped around 60 percent this year. US crude for June delivery rose 34 cents, or 1.8 percent, to $19.18 a barrel. But US oil fell for a fourth month in April and is down 70 percent this year.