Stock markets across the world fell heavily on Monday after Donald Trump suggested that new tariffs he is expected to announce this week would hit “all countries”.

Shares fell across Asia-Pacific markets and in Europe after the US president crushed hopes that “reciprocal tariffs” expected on Wednesday would only target countries that have the largest trade imbalances with the US.

Trump told reporters on Air Force One: “You’d start with all countries. Essentially all of the countries 

Those tariffs on imports into the US are due to be announced on Wednesday, which has been labelled “Liberation Day” by Trump.

On Monday, the threat of a deepening trade war spooked investors. In Toyko, Japan’s Nikkei index lost 4% and South Korea’s Kospi fell 3%.

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Europe’s broad-based Stoxx 600 index dropped 1.7 per cent, while the FTSE 100 lost 1.3 per cent. The Nasdaq 100 was poised to open 1.4 per cent lower and the S&P 500 down 1 per cent. “We’re seeing another wave of US-led selling,” said Trevor Greetham, head of multi-asset at Royal London Asset Management. “There’s been no let-up from Trump.” Consumer-facing companies and other economically sensitive stocks fared the worst, with International Airlines Group down 6 per cent and tourism group Tui down 5 per cent, amid concerns over demand for flights. “I don’t necessarily see the floor quite yet,” said Sharon Bell, senior equities strategist at Goldman Sachs.