(Updates prices in late morning trading in London, adds

comment)

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Stocks extend global selloff after Trump's tariffs

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Banks suffer as investors worry about global recession

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Traders ramp up bets on Fed, BoE, ECB rate cuts

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Safe-haven assets rise, 10-year UST yield falls below 4%

By Harry Robertson and Rae Wee

LONDON/SINGAPORE, April 4 (Reuters) - Global stocks

tumbled for a second day on Friday after U.S. President Donald

Trump's sweeping tariff plans wiped $2.4 trillion off Wall

Street equities, with the sell-off deepening after China said it

would impose additional tariffs of 34% on all U.S. goods.

Banking stocks cratered as investors fretted about growth

and priced in far more central bank rate cuts, with benchmark

10-year U.S. Treasury yields sliding to their lowest since

October, after Trump slapped a 10% tariff on most U.S. imports

and much higher levies on dozens of countries.

"If the current slate of tariffs holds, a Q2 or Q3 recession

is very possible, as is a bear market," said David Bahnsen,

chief investment officer at The Bahnsen Group.

"The question is, does President Trump seek some sort of

off-ramp for these policies if and when we see a bear market in

the stock market."

Europe's STOXX 600 dropped 3.1% after sliding on

Thursday, putting the index on track for its biggest weekly fall

since February 2022 at 6.6%. Japan's Nikkei 225 slumped

2.8% overnight for a second session running.

Futures for the U.S. S&P 500 fell 1.6% after the cash

index plunged 4.8% on Thursday - the biggest one-day fall since

the COVID-19 crisis in 2020.

Nasdaq futures were down 1.7% after the index

dropped 5.4% on Thursday. The VIX index, a closely

watched measure of expected volatility in U.S. stocks, climbed

to the highest since August at 33.

BANKS SLIDE AS RATE CUT BETS RISE

Traders on Friday were pricing in more than 100 basis points

of Federal Reserve rate cuts this year, up from around 75 basis

points on Wednesday, and increased their bets on Bank of England

and European Central Bank reductions too.

The risk of a U.S. and global recession this year has risen

to 60% from 40% earlier after Trump's tariff announcements, J.P.

Morgan said.

Lower interest rates - which dent lenders' margins - and

worries about growth battered banking stocks, with the STOXX 600

banking index slumping 8.7%.

HSBC ( HSBC ) shares dropped 6.9%, UBS fell 5.5%

and BNP Paribas slid 8%.

That followed an 8% rout for Japanese banks overnight

and a sharp sell-off of Wall Street lenders on

Thursday. Citigroup ( C/PN ) dropped more than 12%, Bank of America ( BAC )

sank 11% and a host of other major lenders suffered

similar falls.

"If we start seeing negotiations taking place, or, Trump

dialling back on some of these tariffs, that is the only

possible route to allow for an abatement of the sell-off," said

Aneeka Gupta, equity strategist and economist at WisdomTree.

"But for now that seems very unlikely."

As investors continued to hunt for safety, 10-year U.S.

government bond, or Treasury, yields dropped 16

basis points to 3.897%, after falling 14 basis points on

Thursday. Yields move inversely to prices.

The most obvious sign of nerves about the health of the U.S.

economy and markets was a 1.9% drop in the dollar index

on Thursday, the biggest fall since November 2022.

The dollar found a footing on Friday, however, with the euro

down 0.5% after rallying 1.9% on Thursday.

The Swiss franc, another safe haven, perked up about 0.5%

while the Australian dollar - sometimes seen

as a barometer of investors' risk appetite - plunged 2.2%.

"The thing that might help markets a little bit is that we

get data that suggests that, actually, we are going to get

1%-plus growth in the U.S. in the last quarter," said Michael

Metcalfe, head of macro strategy at State Street Global Markets.

Metcalfe pointed to U.S. nonfarm payrolls data, due at 1230

GMT (8.30 a.m. ET), as one key data point. The figures are

expected to show the U.S. economy added 135,000 jobs in March,

down from 151,000 in February.

Japanese 10-year government bond yields were

set for their biggest weekly fall - at 37 basis points - since

1992 and last traded at 1.175%.

Oil prices also dropped on worries about growth and demand

, with Brent crude futures down 2.9% to $68.10 a barrel.