* Pompeo says 'significant evidence' virus emerged from lab
* Dollar, gold rise on trade tensions
* European stocks fall
* Oil prices slip
* U.S. futures in negative territory
By Julien Ponthus
LONDON, May 4 (Reuters) - European stock markets and oil
prices fell on Monday as a spat between top U.S. officials and
China over the origin of the coronavirus fuelled fears of a new
trade war, derailing a rebound in global markets.
European shares .STOXX were down 2.5% in mid-morning
trading, with sectors sensitive to economic growth including oil
and gas .SXEP , automakers .SXAP and banks falling between
about 4% and 5.5%.
Volatility gauges for European and American blue-chip stocks
shot up to a two-week high while U.S. stock futures ESc1 were
about 1% in the red.
Earlier, MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS fell 2.5%, pulled down by Hong
Kong where the Hang Seng .HSI returned from a two-session
holiday with its biggest drop in six weeks.
U.S. Secretary of State Mike Pompeo said on Sunday there was
"a significant amount of evidence" that the novel coronavirus
emerged from a laboratory in the central Chinese city of Wuhan.
The U.S. dollar rose against most major currencies amid
fears that last year's U.S.-China dispute would be reignited,
this time over the origins of the pandemic that has stalled
economies around the world.
The euro was down 0.37% at $1.0933 EUR=EBS and the pound
retreated 0.72% to $1.2407 GBP=D3 .
Gold prices also rose as investors sought safety. Spot gold
XAU= was up 0.3% at $1,704.31 per ounce.
Pompeo did not provide evidence or dispute an earlier U.S.
intelligence conclusion that the virus was not man-made.
An editorial in China's Global Times said he was "bluffing"
and called on the United States to present its evidence.
"Concern on the potential for another flare up between the
U.S. and China is dominating price action," RBC strategist Adam
Cole said in a morning note.
Simon Black, head of investment management at wealth
management firm Dolfin said investors were also adjusting their
forecasts for the depth of the economic damage the pandemic will
inflict.
"It's also the economic reality sinking in," he said, adding
that a rebound by global equities of over 20% from lows hit in
March was not likely to be sustainable.
Companies listed on the pan-European STOXX 600 .STOXX are
currently expected to report a 40% decline in earnings in the
second quarter. Manufacturing activity in the euro zone collapsed last month
as government-imposed lockdowns to stop the spread of the new
coronavirus forced factories to close and consumers to stay at
home, a survey showed on Monday. "We've just come off a rally of hopes, not a rally on
fundamentals", Black said, pointing to the massive monetary and
fiscal stimulus pledged by governments and central banks around
the world.
Recent economic data paints a dire picture of the global
economy after weeks of lockdowns.
In the United States, manufacturing plunged to an 11-year
low last month and consumer spending collapsed. Some 30.3
million Americans have filed unemployment claims.
Oil prices fell again, paring last week's gains, on worries
a global oil glut may persist even as lockdowns start to ease.
U.S. West Texas Intermediate (WTI) crude CLc1 futures fell
5.5% to $18.69 a barrel while Brent crude LCOc1 futures were
down 2.8% at $25.70.
Global coronavirus cases have surpassed 3.5 million and
deaths have neared a quarter of a million, according to a
Reuters tally.
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