Global stock markets saw mild losses yesterday as China-US trade tensions resurfaced, with gloomy sentiment exacerbated by news of a recession in Hong Kong.

The Paris markets was dogged by heavy losses for French carmaker PSA, whose stock tanked as investors remained unconvinced by a proposed mega-merger with Italy’s Fiat Chrysler.

Corporate earnings disappointment also hurt London stocks with sizeable falls for energy major Royal Dutch Shell, as well as lenders Lloyds Banking Group and Standard Chartered.

Investors dumped risky equities for safer assets after Beijing slammed US Secretary of State Mike Pompeo for a speech it said had “viciously attacked” China.

Wall Street followed Europe lower, “with US-China trade uncertainty flaring back up”, said Charles Schwab analysts.

In the latest hawkish take on China by Trump’s administration, Pompeo had Wednesday called Beijing “truly hostile” to the United States, and vowed to ramp up pressure on China on multiple fronts.

Hong Kong’s stock market rallied by 0.9 per cent in value, but after the close came gloomy news of an official recession. Shanghai ended down 0.4 per cent after figures pointed to another contraction of China’s crucial manufacturing industry owing to the US trade war.

Official figures meanwhile showed Hong Kong’s gross domestic product in the third quarter shrank 3.2 per cent from the previous quarter, which had already seen a drop of 0.4 per cent.