Officials from Mexico, Canada and China warned of broad negative economic consequences after Trump called for a 25% tariff on imports from Canada and Mexico and an additional 10% levy on Chinese goods, until the countries clamped down on illicit drugs and migrants crossing the border.

The dollar gained and investors sold off stocks after the president-elect promised to levy new restrictions on the United States’ biggest trade partners.

While the reaction in US stocks was muted, global equities were rattled. Markets are wondering if Trump's threats are mainly a negotiating tactic.