Tokyo, Feb 3 (AP) Global shares mostly fell in Monday trading as worries grow about President Donald Trump imposing tariffs on key US trading partners.

France's CAC 40 slipped 1.6% in early trading to 7,826.14, while Germany's DAX dropped 1.5% to 21,395.31. Britain's FTSE 100 fell 1.3% to 8,565.00. US shares were set to drift lower with Dow futures down 1.2% at 44,152.00. S&P 500 futures slipped 1.5% to 5,977.25.

Japan's benchmark Nikkei 225 lost 2.7% to finish at 38,520.09. Australia's SP/ASX 200 declined 1.8% to 8,379.40. South Korea's Kospi dropped 2.5% to 2,453.95. Hong Kong's Hang Seng dipped less than 0.1% to 20,217.26, while trading was closed in Shanghai for a holiday.

Analysts said Asian markets were bracing for volatility set off by a possible trade war escalation.

“The implications for trade restrictions could result in reduced global trade flows, supply chain shifts which could mean higher costs for businesses, and higher inflation,” said Yeap Jun Rong, market strategist at IG.

The share price of SoftBank Group Corp rose 0.5% after it announced at an event with OpenAI in Tokyo that they were setting up SB OpenAI Japan, in which each would own a 50% share, to offer artificial intelligence services to companies.

Investors have been jolted by a report from a Chinese upstart, DeepSeek about developing a cheaper large language model that can complete globally. The disruption raised questions about whether all the investment expected for AI chips is really needed, sending some technology shares tumbling.

Shares of technology companies listed in Hong Kong seemed to hold up despite the threat of Trump's tariffs, partly because DeepSeek highlights the strength of the nation's technology sector.

Trump's 25% tariffs on most imports from Canada and Mexico and 10% tariffs on goods from China are to take effect Tuesday. His administration has not said what specific improvements would need to be seen in stopping illegal immigration and the smuggling of fentanyl to merit the removal of the tariffs.

Canada and Mexico ordered retaliatory tariffs on American goods. Canada's will take effect Tuesday on a range of products, while Canada didn't give immediate details.

Also last week, the US Federal Reserve left its benchmark interest rate unchanged, taking a more cautious view on how policies under Trump might impact inflation and the broader economy.

In energy trading, benchmark US crude jumped $1.76 to $74.29 a barrel. Brent crude, the international standard, gained $1.04 to $76.71 a barrel.

In currency trading, the US dollar edged up to 155.41 Japanese yen from 155.18 yen. The euro cost $1.0250, down from $1.0363. (AP) NSA NSA

Tariff measures on major trading partners risk triggering retaliatory duties and supply chain disruption affecting trade flows and costs. The document explains the imposition of tariff measures on imports from specified trading partners, the absence of defined benchmarks for their removal (linked to immigration and narcotics interdiction), and the immediate retaliatory duties by affected partners, producing bilateral tariff regimes that disrupt supply chains, reduce trade flows, raise business costs, and interact with monetary policy to increase market volatility.