LONDON • American index futures declined along with stocks in Europe as US President Donald Trump lashed out at China in a series of tweets, just as the two countries restart trade negotiations.

The British pound dropped to a two-year low as the possibility of a no-deal Brexit increased.

Broadly positive earnings from companies including Xerox, Merck and Procter & Gamble did little to boost contracts on the three main US stock gauges as Mr Trump said China continues to "rip off" America and that the Asian nation has not followed through with pledges to buy US agricultural goods.

In Europe, disappointing forecasts from the likes of Reckitt Benckiser and Bayer compounded a glum mood, and the Stoxx Europe 600 Index fell the most in two months.

Earlier, stocks rose across Asia, including in Hong Kong despite continuing protests in the Chinese city.

Structural opportunities in China's tech-related sectors are worth attention, given Beijing's urgency to seek tech independence amid the bitter trade war with the United States, investment bank CICC noted in a report.

Treasury yields declined and the US dollar was little changed.

"You have very supportive policy and the markets are taking the glass-half-full version of that, which is 'interest rates are low, therefore valuations can go higher', as opposed to the glass-half-empty version which is 'policy is supportive, that must be because the outlook is really dire and we are heading into a recession'," said Ms Kate Howitt, portfolio manager of the Australian Opportunities Fund at Fidelity International in Sydney.

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