Swirling uncertainty over U.S. President Donald Trump's political future saw world stocks extend their steepest fall in over six months on Thursday, though there were signs of stabilisation elsewhere as the dollar and gold steadied. Sonia Legg reports.
More than 24-hours after markets started their u-turn they were still going in the wrong direction. European shares hit a two week low in Thursday morning trade, with key indexes dropping up to one and half percent. That followed Asia's worst day in eight months. And the cause had little to do with either region. (SOUNDBITE) (English) CCLA, CHIEF INVESTMENT OFFICER, JAMES BEVAN, SAYING: "This is certainly the first time since the US presidential election that there's been even a whiff of real concern that Mr. Trump will not deliver on the critical challenge of cutting taxes and deregulating. And of course in terms of corporate earnings per share, the S&P 500 is essentially expected to achieve 150 dollars per market point for 2018, that would fall all the way back to around 135. So if those tax cuts don't come it is a huge issue for the market." Reports that Trump had tried to intervene in an investigation into alleged Russian interference in last year's U.S. election. And that his aides had numerous undisclosed contacts with Russian officials kept market tensions high. (SOUNDBITE) (English) CCLA, CHIEF INVESTMENT OFFICER, JAMES BEVAN, SAYING: "We should be worried in so far as it is correct that Mr. Trump's tenure in the White House may be limited or constrained or his capacity to get stuff done is limited. Then the agenda of tax cuts and regulatory reform will be obviously in doubt." The dollar steadied, pulling out of a dive that had taken it to its lowest level in six months against other top currencies. Another troubled currency - was the Brazilian real. It fell 1.2 percent in local markets after Brazilian President Michel Temer was linked to the country's biggest-ever graft probe