* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* U.S. tariffs on EU goods hits already weak sentiment
* Treasury yields show waning confidence in growth
* Risk assets lose out but safe havens rise
* Oil falls due to worries about oversupply
By Stanley White
TOKYO, Oct 3 (Reuters) - Asian stocks, already under
pressure from growing global growth fears, tumbled on Thursday
after New York markets slumped overnight because the United
States opened a new trade war front by saying it will impose
tariffs on $7.5 billion of goods from the European Union.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS dropped 0.38%. Japan's Nikkei stock index
.N225 dropped 1.96% and Australian shares .AXJO declined
2.19%.
Yields on two-year U.S. Treasury yields approached a
two-year low and the dollar fell against major currencies as
weakening economic data exposed the damage that the trade war
with China has already caused to the U.S. economy.
Oil future extended their decline in Asia as a
bigger-than-expected increase in U.S. crude inventories and
growing evidence of slowing economic growth point to lower
energy demand.
The United States and China have already hiked tariffs on
each other's goods in a year-long trade row that has raised the
risk of recession and caused major central banks to ease
monetary policy.
The chance that Europe will respond in kind to U.S. tariffs
is likely to further fuel concerns that global growth is set for
a prolonged period of stagnation.
"In the short term it looks a bit dicey (for markets) given
the declines we've already had in the past two days," said
William O'Loughlin, portfolio manager at Rivkin Asset Management
in Sydney.
"The EU tariffs are concerning. I agree that sentiment for
equities will be weak. The bond market is saying it's not
confident in future growth."
U.S. stock futures ESc1 were up 0.21%, but this did little
to bolster sentiment after shares on Wall Street suffered their
sharpest one-day decline in nearly six weeks on Wednesday.
The United States on Wednesday said it would enact 10%
tariffs on European-made Airbus AIR.PA planes and 25% duties
on French wine, Scotch and Irish whiskies and cheese from across
the continent as punishment for illegal EU aircraft subsidies.
The tariffs announced Wednesday were approved by the World
Trade Organization but could still cause friction across the
Atlantic.
EU manufacturers are already facing U.S. tariffs on steel
and aluminium and a threat from U.S. President Donald Trump to
penalise EU cars and car parts. The two-year yield US2YT=RR fell to 1.4760%, close to a
two-year low of 1.4280%, after a weak U.S. private sector jobs
report depressed boosted expectations that the Federal Reserve
will cut interest rates this month.
Traders see a 74.4% chance the Fed will cut rates by 25
basis points to 1.75%-2.00% in October, up from 39.6% on Monday,
according to CME Group's FedWatch tool. FEDWATCH
Bets on a rate cut could rise further if U.S. non-farm
payrolls due on Friday show weakness in the labour market.
The dollar index .DXY against a basket of six major
currencies stood at 99.020, extending a retreat from a two-year
high reached on Tuesday.
Spot gold XAU= , a safe-haven asset that investors often
buy during time of heightened risk, rose 0.02% to $1,499.59 per
ounce. GOL/
U.S. crude CLc1 dipped 0.3% to $52.48 a barrel. In
addition to a slowing global economy, energy traders are worried
about an oversupplied market and the chance of geopolitical
friction in the Middle East.
(Editing by Richard Borsuk)