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Investors have a different impression. Markets tumbled from Asia to Europe on fears that escalating retaliation between countries could choke off trade and the global economy.

Industrial companies in the S&P 500 fell 1.9 percent for the sharpest loss among the 11 sectors that make up the index.

USA stocks went on another dizzying ride Friday and worked their way back from an early-morning plunge to send the Standard & Poor's 500 index to its first gain in four days.

Blue-chip companies, which do more sales overseas than smaller ones, fared worse than the rest of the market.

Trump on Thursday threatened a 25 percent tariff on steel imports and 10 percent on aluminum without exemptions for any countries, igniting a selloff in a market already on edge over rising USA interest rates and bond yields.

The Standard & Poor's 500 index dropped 36 points, or 1.3 percent, to 2,677.

The S&P 500 is on pace for a loss of 3.5 percent this week, which would be its third decline that severe in the last five weeks.

The Dow Jones industrial average came mostly back from a 390-point loss and ended down 70 points, or 0.3 per cent, at 24,538.

Worries about the possibility of higher inflation and interest rates have meant big swings for markets since the S&P 500 set its latest record high in late January. That means Apple and other big USA companies are dependent on customers not only in Peoria but also Paris and Peru.

Federal Reserve Chairman Jerome Powell tried to temper remarks he made on Tuesday that raised concerns about the potential for four interest rate hikes this year rather than the Fed's forecast of three, but New York Fed President William Dudley, speaking in Sao Paulo, Brazil, was a bit more pointed and said four rate hikes would be "gradual". That could easily upset markets, which had been enjoying a remarkably smooth ride a year ago.

Stocks of smaller USA companies, which tend to do more of their business at home, did much better than the rest of the market.

Earlier in the week, he helped send Treasury yields jumping and stocks tumbling when he said that he's feeling more optimistic about the economy. Later in the week, though, Powell may have calmed some of the fears when he said that he does not see inflation in wages "at a point of acceleration".

The yield on the key 10 year bond fell to 2.86% on Wednesday and to around 2.802% on Thursday - a sign that investors are selling out of shares and commodities and heading for the safest haven of all - US Treasuries. The Nasdaq composite was up 10 points, or 0.1 percent, to 7,283. The two-year yield slipped to 2.23 percent from 2.26 percent, and the 30-year yield dropped to 3.11 percent from 3.13 percent.

Phil Orlando, chief equity strategist at Federated Investors in NY, said Trump's announcement was made to call everyone's attention to the US trade deficit but investors decided that a full-blown global trade was not going to happen.

The ASX 200 year to date was down 0.8% at the end of February - yesterday's fall took that to 1.5% and today's drop could push it well past 2%. They rose again after President Donald Trump told industry executives that he'll impose import tariffs "next week". Canada sends 75 per cent of its exports to the United States.

Coming after the 0.4% fall in the ASX 200 in February, Thursday's 0.7% fall, March is already looking as though it will be in the red by more than 1.5% after just two days trading.

The Dow Jones industrial average sank 223 points, or 0.9 per cent, to 24,389.

Caterpillar fell 2.6 per cent. The FTSE 100 in London dropped 0.8 percent.