Portugal Colonial - Wall Street stocks bounce after Trump-fuelled slide

European stock markets made modest gains while Asia's leading stock markets began the week in the red as they caught up with Wall Street's sharp losses Friday.

Gold reached a fresh record high thanks to its status as a safe haven investment.

"Things have calmed down almost as dramatically as the flare up on Friday when Donald Trump threatened 100 percent tariffs on China," said City Index and FOREX.com analyst Fawad Razaqzada.

Trump wrote Friday on social media that he would impose an additional 100-percent tariff on China and threatened to cancel a meeting with Chinese counterpart Xi Jinping.

The US president had been to meet Xi at the Asia-Pacific Economic Cooperation (APEC) summit later this month, which was to be their first encounter since Trump returned to power in January.

The US president cited Beijing's export curbs on rare earth minerals used in a range of goods including smartphones, electric vehicles and military hardware.

Wall Street's Nasdaq index plunged 3.6 percent following Trump's comments, with investors also on edge over worries about a tech stock bubble following a recent surge on massive AI investments.

Beijing accused Washington of acting unfairly, and the Ministry of Commerce said Sunday: "Threatening high tariffs at every turn is not the right approach to engaging with China."

But Trump took a more conciliatory tone Sunday.

"Don’t worry about China, it will all be fine!," the US president said in a post on his Truth Social account.

Trump's comments helped shift sentiment, with the dollar perking up and US stocks futures rebounding.

"To be blunt, this is just such nonsense -- the heaving to and fro on social media posts -- but it is what it is, and the stock market seems to be fine playing the part of the puppet," said Briefing.com analyst Patrick O'Hare.

"Friday's price action exposed how vulnerable market pricing is to developments that threaten the rose-coloEurred outlook embedded in premium valuations," he added.

The latest spat follows months of fragile peace between the economic superpowers as they looked to reach a full trade deal after Trump's tariff bombshell in April that saw both sides ramp up tit-for-tat levies to eye-watering levels.

Meanwhile, shares in chip giant Broadcom jumped 10 percent after OpenAI, the company behind ChatGPT, announced it is teaming up with the firm to design and build its own specialised computer processors for artificial intelligence.

"Broadcom has been talked about as a worthy member of the club of tech mega caps, and today’s deal with OpenAI cements its position as one of the real movers in the sector," said Chris Beauchamp, chief market analyst at trading platform IG.

"The news comes at just the right time after the knock to sentiment on Friday, reminding investors that the race for computing power is still on, and if anything is intensifying," he added.

In the past few weeks, under the leadership of CEO Sam Altman, OpenAI has signed huge investments in data centres and AI chips with US companies Nvidia and AMD, as well as with South Korea's Samsung and SK hynix.

The deals have boosted the prices of tech stocks and help push the Nasdaq to record highs.

- Key figures at around 1530 GMT -

New York - Dow: UP 1.3 percent at 46,083.63 points

New York - S&P 500: UP 1.5 percent at 6,650.90

New York - Nasdaq Composite: UP 2.0 percent at 22,640.68

London - FTSE 100: UP 0.2 percent at 9,442.87 (close)

Paris - CAC 40: UP 0.2 percent at 7,934.26 (close)

Frankfurt - DAX: UP 0.6 percent at 24,387.93 (close)

Hong Kong - Hang Seng Index: DOWN 1.5 percent at 25,889.48 (close)

Shanghai - Composite: DOWN 0.2 percent at 3,889.50 (close)

Tokyo - Nikkei 225: Closed for a holiday

Euro/dollar: DOWN at $1.1569 from $1.1615 on Friday

Pound/dollar: DOWN at $1.3328 from $1.3352

Dollar/yen: UP at 152.32 yen from 151.57 yen

Euro/pound: DOWN at 86.80 pence from 86.98 pence

Brent North Sea Crude: UP 1.5 percent at $63.67 per barrel

West Texas Intermediate: UP 1.7 percent at $59.90 per barrel

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O.Gaspar--PC