Shares spiral on arrest of China executive; oil sinks as output decision delayed

NEW YORK (Reuters) – Stock markets around world tumbled on Thursday as the arrest of a top Chinese technology executive cast further shadows on U.S.-China trade relations, while oil prices sank on fears of smaller-than-expected output cuts.

The arrest of smartphone maker Huawei Technologies Co.’s Chief Financial Officer Meng Wanzhouof in Canada for extradition to the United States came as Washington and Beijing prepared for key talks aimed at resolving a bitter trade spat.

The Dow Jones Industrial Average fell 679.46 points, or 2.71 percent, to 24,347.61, the S&P 500 lost 67.8 points, or 2.51 percent, to 2,632.26 and the Nasdaq Composite dropped 139.83 points, or 1.95 percent, to 7,018.60.

MSCI’s gauge of stocks across the globe shed 2.53 percent, while the pan-European STOXX 600 index lost 3.31 percent.

Emerging market stocks lost 2.76 percent. MSCI’s broadest index of Asia-Pacific shares outside Japan closed 2.28 percent lower, while Japan’s Nikkei lost 1.91 percent. Canadian authorities late on Wednesday said they had arrested Meng, also the daughter of Huawei’s founder, on Dec. 1, the same day that U.S. President Donald Trump and Chinese leader Xi Jinping met at the G20 summit in Argentina.

The world’s two economic superpowers had agreed on a 90-day trade truce period to hammer out a more permanent agreement, which sent global stock markets soaring on Monday. Equities reversed course the next day as uncertainty grew that the U.S. and China could, in fact, find common ground.

“In general, we all have the same questions we did on Tuesday,” said Art Hogan, chief market strategist at B.

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