* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* Trump offers no new details on U.S.-China trade pact
* Trade war has taken toll on major economies
* Commodities highlight concern about global demand
(Updates throughout, changes byline, dateline)
By Sujata Rao
LONDON, Nov 13 (Reuters) - European shares fell on Wednesday
from four-year highs after U.S. President Donald Trump
threatened to "substantially" increase tariffs if China failed
to agree a trade deal and also took a swipe at European Union
trade policies.
Concern is also growing that the intensifying unrest in Hong
Kong could prompt a Chinese crackdown, pushing Hong Kong shares
2% lower .HSI and weighing on markets across Asia.
MSCI's index of world shares slipped 0.2% .MIWD00000PUS ,
following a 1% fall in Asian shares outside Japan. Japan's
Nikkei slipped almost 1%, moving further off last week's
13-month highs .N225 .
"The market was anticipating something more positive from
Trump, but he didn't deliver," said Justin Onuekwusi, a
portfolio manager at Legal & General Investment Management.
"In recent weeks, we saw the balance of probabilities shift
to the positive side, risks being taken off the table, but
people have realised that risk is still there," Onuekwusi said.
He's been reducing his equity allocations, he said.
Trump's speech threatened to raise tariffs on China, but he
also said a trade deal was "close", without offering details on
when or where it would be signed. He also criticised EU trade
policies before a Nov. 14 deadline to decide whether to raise
tariffs on European and Japanese carmakers.
That deadline will probably be extended, but investors
remain jittery. A pan-European equity index .STOXX opened half
a percent lower, coming off Tuesday's four-year highs, when
optimism before Trump's speech and better-than-expected economic
indicators from Germany boosted stock.
An index of European auto companies .SXAP slipped 1.3%.
Brent crude oil futures were down 0.5%
diminishing prospects for a resolution to the 16-month long
trade war suggested less future demand for energy.
Expectations for phase one of a trade deal this month have
supported stocks and riskier assets recently. Investors were led
to cut the share of cash in their portfolios to
six-and-a-half-year lows, according to Bank of America Merrill
Lynch's monthly survey of global managers.
The poll also showed growth optimism at 18-month highs.
However, lack of progress on an agreement has started to
increase doubts about whether a trade truce will happen at all.
"I'm absolutely concerned. The clock is ticking," said
Michael McCarthy, chief market strategist at CMC Markets in
Sydney. "Markets are now expecting substantial progress in the
next week or so, and if not, then confidence could crumble."
Equity futures suggested U.S. stocks would open lower, with
the S&P500 ESc1 indicated down 0.2%. The S&P closed up .SPX
on Tuesday, backing off record highs after Trump's speech.
The S&P 500 has risen 2% this month and 23% so far in 2019
thanks to interest rate cuts, trade hopes and robust corporate
earnings -- profits at three-quarters of S&P 500 companies have
topped expectations this quarter, according to Refinitiv.
European shares have gained 2.3% this month.
But a more prolonged standoff will revive fears for the
world economy. Oxford Economics estimates the trade war has
trimmed eight-tenths of a percentage point off U.S. growth.
Having started 2019 with 3.1% growth, the economy eased to 1.9%
in the third quarter, they noted
Asian markets were also rattled, by Trump's speech and Hong
Kong's turmoil. Onshore spot yuan CNY=CFXS fell to a low of
7.0270 per dollar at one point, the weakest since Nov. 5.
Hong Kong protesters planned to paralyse parts of the city
for a third day, with transport, schools and many businesses
closing after violence escalated across the city. Hong Kong interbank rates rose, with one-month HIBOR at its
highest since Aug. 6 HIHKD1MD= . London-listed shares in HSBC
fell almost 2%.
But the New Zealand dollar NZD=D3 rose more than 1% to
$0.6402 after the central bank unexpectedly left interest rates
on hold at 1%. The U.S. dollar gained 0.10% against a basket of currencies,
just off three-week highs .DXY . Yields on 10-year Treasury
notes US10YT=RR held off recent three-month highs. Bond yields
dipped across the euro zone as well DE10YT=RR .
U.S. markets were waiting for data later on Wednesday that
was expected to show inflation rose in October. Federal Reserve
Chairman Jerome Powell will also provide testimony to a
Congressional committee.
Hong Kong stocks have suffered during protests https://tmsnrt.rs/2MJbLuj
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(Editing by Larry King)