GLOBAL MARKETS-Investors seek safety on threat of wider U.S.-China spat

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* Global stocks slide as new target on trade spat appears
* Sterling hits lowest since January amid Brexit chaos
* Dollar holds near one-month high ahead of Fed minutes
* Crude prices fall on swelling U.S. stockpiles

By Herbert Lash
NEW YORK, May 22 (Reuters) - Global equity markets slid on
Wednesday as investors sought safety in bonds, the Japanese yen
and Swiss franc amid renewed worries over the U.S.-China trade
standoff after reports the United States has another Chinese
tech firm in its sights.
Relief over Washington's temporary relaxation of curbs
against China's Huawei Technologies Co Ltd evaporated after
reports that the White House is considering further sanctions on
Chinese video surveillance firm Hikvision. Fears of another blacklisting reinforced worries that U.S.
President Donald Trump is looking beyond sealing a trade deal
with China to a potentially bigger battle aimed at curbing
Beijing's technology ambitions.
The yen and Swiss franc gained against the dollar and the
price of the 10-year U.S. Treasury note rose, but the decline in
U.S. and European equity markets was subdued.
"The market is still expecting a resolution or at least a
modification of some of the worrying aspects out there about the
trade relationship," said John Vail, chief global strategist at
Nikko Asset Management in New York.
Major central banks around the world still have
accommodative monetary policies, which favors equities, he said.
"Clearly the situation is more fraught than it has been in
the past," Vail said. "But for the time being we're still
positive on equity markets globally."
Asia-Pacific shares outside Japan .MIAPJ0000PUS closed
0.03% higher, while Japan's Nikkei .N225 rose 0.05%.
The Chinese markets, which have endured a volatile few
months, were on the backfoot. The Shanghai Composite Index
.SSEC closed down 0.5%.
MSCI's gauge of stock performance in 47 countries across the
globe .MIWD00000PUS shed 0.20% and the FTSEurofirst 300 index
.FTEU3 of leading Europeans shares fell 0.13%.
On Wall Street, the Dow Jones Industrial Average .DJI fell
70.84 points, or 0.27%, to 25,806.49. The S&P 500 .SPX lost
6.85 points, or 0.24%, to 2,857.51 and the Nasdaq Composite
.IXIC dropped 20.32 points, or 0.26%, to 7,765.40.
London's FTSE 100 blue chips FTSE bucked the trend, rising
0.07% as sterling slumped to lows last seen in early January
amid renewed worries about the country's messy exit from the
European Union.
The pound GBP= fell 0.43% to $1.2650, its lowest since
early January, after Prime Minister Theresa May's final gambit
to get a divorce deal approved failed dramatically.
The dollar held near a one-month high ahead of the release
of Federal Reserve meeting minutes, which may provide more clues
on why the U.S. central bank stood pat on interest rates earlier
this month.
Investors sought havens in the Swiss franc, Japanese yen and
German government bonds. FRX/ GVD/EUR
The yen strengthened away from two-week lows against the
dollar, rising 0.17% to 110.30 yen JPY= , while the Swiss franc
EURCHF= CHF= was higher against the euro and the dollar. The
euro fell 0.04% against the dollar to $1.1154 EUR= .
In commodities, U.S. West Texas Intermediate (WTI) crude
futures CLc1 were down $1.25 at $61.88 per barrel after
American Petroleum Institute data showed that U.S. crude
stockpiles rose unexpectedly last week. O/R
Oil was also pressured by Saudi Arabia reiterating that it
would aim to keep the market balanced and try to reduce tensions
in the Middle East. Brent crude futures LCOc1 lost $1.01 to $71.17 per barrel.
Benchmark 10-year notes US10YT=RR last rose 10/32 in price
to yield 2.3909%.

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