*

European stock markets fall as central banks flag concerns

*

PBOC, BoE and Riksbank hold rates, Switzerland cuts

*

US stock futures turn red, dollar rises in Europe

*

Chinese shares slide as high flying tech firms take hit

By Marc Jones

LONDON, March 20 (Reuters) - World stock markets slipped

on Thursday as the U.S. Federal Reserve and a trio of Europe's

top central banks warned about rising levels of global

uncertainty.

Trade war and actual war worries pushed Europe's main share

indexes down almost 1%. Wall Street futures were 0.5%

in the red, while safe-haven government bonds were back in

demand and gold hit its latest record high.

A central bank triple header provided a unerringly common

theme in Europe too.

"There's a lot of economic uncertainty at the moment," Bank

of England Governor Andrew Bailey said as the BoE held UK

interest rates.

Both Switzerland's and Sweden's central bank chiefs also

warned that uncertainty around the global economy and inflation

had increased significantly.

"The Fed yesterday, the Riksbank, the SNB, the BOE today -

central banks are all looking at very noisy data and rising

geopolitical risks," said James Rossiter, senior global

strategist at TD Securities.

"And markets are juggling that to the same degree. There is

low conviction in markets, just as there is low conviction among

central banks... everyone is just waiting to see."

The Fed on Wednesday left U.S. rates unchanged but traders

were pleased to see it maintain a projection for two

quarter-percentage-point rate cuts by year-end.

Policymakers revised up their inflation forecast for the

year however and marked down their outlook for economic growth,

citing risks from U.S. President Donald Trump's tariff policies.

Still, investors took comfort from the Fed's "dot plot" and

Chair Jerome Powell's comments that tariff-driven inflation

would be "transitory" and largely confined to this year.

"We think unemployment will be the ultimate arbiter," PIMCO

economist Tiffany Wilding said, predicting the Fed would "cut

aggressively" if the jobless rate starts to move higher.

All the uncertainty and unknowns around inflation saw gold

scale yet another record high of $3,057.21.

In the bond markets, U.S. Treasury yields were back under

4.2% and Germany's Bund yields eased to 2.77% having

hit a 1-1/2 year high of 2.938% last week.

The dollar meanwhile jumped 0.6% having just hit a

5-month low. It rose to $1.0832 against the euro,

$1.2951 against the pound and to 148.60 yen.

Sterling climbed as far as $1.3015 - a four-month

high - overnight. The Bank of England's move to keep UK rates at

4.5% came with a warning against assuming they would be cut in

the coming months.

"The Bank of England is stuck between a rock and a hard

place with inflationary pressures mounting alongside a weak

growth outlook," said Zara Nokes, global market analyst at JP

Morgan Asset Management.

Both Switzerland's SNB and Sweden's Riksbank had already

come out with their decisions earlier in the day.

The former trimmed its borrowing costs to just 0.25% with a

warning about U.S. trade tariffs, while the Swedes kept theirs

at 2.25% amid stubborn inflation and a sluggish economy.

There was little reaction, other than a fractional dip by

the Swiss franc.

SNB Chairman Martin Schlegel said uncertainty around the

global economy and inflation had increased significantly. "At

present, the risks are predominantly to downside," he said.

CHINA DRAGS

U.S. stock indexes were set to open lower, as worries about

the fallout from U.S. tariff policies crept back into markets.

The post-Fed reaction failed to rally Asia overnight, with

MSCI's broadest index of Asia-Pacific shares outside Japan

finishing its day flat.

That was mainly due to China and Hong Kong.

Both markets have been on hot streaks this year, but

Thursday's 2.2% drop in the Hang Seng was its worst of

the month and Chinese online giants Tencent and Baidu ( BIDU )

both tumbled nearly 4% as their respective 30% and 70%

gains this year ran out of steam.

Carlos von Hardenberg co-founder of MCP Emerging Markets

described the recent surge in China tech stocks as "a bit of a

sucker's rally, because it reached the point where the valuation

was getting completely out of whack".

"I think it could evaporate almost overnight because we are

in the middle of a gigantic war about technology leadership."

China's central bank held its benchmark lending rates steady

for the fifth straight month, matching market expectations.

The yuan, which has been pressured by China's

wide yield differentials with the United States, barely budged

at 7.2354 per dollar in the onshore market. Its offshore

counterpart inched down 0.1% to 7.2383 per dollar.

Elsewhere, the Australian dollar tumbled 1% in

response to weaker-than-expected employment figures while data

showing New Zealand's economy grew faster than forecast at the

end of last year could not prevent a 1.2% drop in the Kiwi

dollar.

In commodities, oil prices ticked down as a

higher-than-expected fuel inventory drawdown in the U.S. and

renewed tensions in the Middle East countered strength in the

dollar.

Brent crude futures dipped to $70.8 a barrel, while

U.S. West Texas Intermediate crude (WTI) hovered at

$67.11 per barrel.