Europe’s stock markets slid Tuesday as a standoff between Italy and Brussels revived eurozone fears, while Wall Street ended mixed amid lingering worries over US-China trade relations. 
The euro eased against the dollar, while oil prices fell back after a recent surge. 
‘Renewed fears about the US-China trade dispute and the state of Italian politics has shaken European equity markets,’ noted David Madden, market analyst at CMC Markets UK.
Eurozone finance ministers on Monday warned Italy to abide by EU rules on public spending, just days after Rome announced a big spending boost in defiance of Brussels.
But on Tuesday, Italy’s Deputy Prime Minister Matteo Salvini threatened to seek damages from European Commission President Jean-Claude Juncker for scaring off investors by attacking Rome’s budget plans.
‘Is the aim to attack the government and Italian economy? We are ready to ask for compensation from those who wish Italy ill,’ Salvini said on Twitter.
Equity markets in Paris, London and Frankfurt all fell.
‘Markets are extremely unsettled by the growing risk of a sovereign debt crisis in Italy,’ said a note from High Frequency Economics.
US stocks finished a mixed session with the Dow pushing up 0.5 percent to a fresh all-time record of 26,773.94. 
But the Nasdaq retreated as social media and some semiconductor stocks took a hit.
Earlier in Asia, Hong Kong ended sharply lower, with investors there playing catch up after a long weekend.
Going against the grain on Tuesday, Tokyo’s benchmark Nikkei index rose for a third straight session to a fresh 27-year high on a cheap yen and advances on Wall Street.
Among individual companies, Amazon fell 1.7 percent after announcing it would lift its minimum wage for US workers to $15 per hour, addressing longstanding criticism that the company has underpaid staff.
Tesla Motors fell 3.1 percent after reporting it had met key production targets for its Model 3 sedan in the third quarter even as it warned that the US-China trade conflict weighed on performance. Tesla had surged more than 17 percent on Monday following a settlement between US securities regulators and chief executive Elon Musk.
Key figures around 2050 GMT
New York – Dow Jones: UP 0.5 percent at 26,773.94 (close)
New York – S&P 500: DOWN less than 0.1 percent at 2,923.43 (close)
New York – Nasdaq: DOWN 0.5 percent at 7,999.55 (close)
London – FTSE 100: DOWN 0.3 percent at 7,474.55 (close)
Frankfurt – DAX 30: DOWN 0.4 percent at 12,287.58 (close)
Paris – CAC 40: DOWN 0.7 percent at 5,467.89 (close)
EURO STOXX 50: DOWN 0.7 percent at 3,388.99 (close)
Tokyo – Nikkei 225: UP 0.1 percent at 24,270.62 (close)
Hong Kong – Hang Seng: DOWN 2.4 percent at 27,126.38 (close)
Shanghai – Composite: Closed for public holiday
Euro/dollar: DOWN at $1.1548 from $1.1578 at 2100 GMT
Pound/dollar: DOWN at $1.2979 from $1.3042
Dollar/yen: DOWN at 113.68 from 113.93 yen
Oil – Brent Crude: DOWN 17 cents at $84.80 per barrel 
Oil – West Texas Intermediate: DOWN 7 cents at $75.23 per barrel