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- Honda and Nissan to launch merger talks
- Police arrest suspect who set woman on fire in New York subway
- China vows 'cooperation' over ship linked to severed Baltic Sea cables
- Australian tennis star Purcell provisionally suspended for doping
- Luxury Western goods line Russian stores, three years into sanctions
- Wallace and Gromit return with comic warning about AI dystopia
- Philippine military says will acquire US Typhon missile system
- Afghan bread, the humble centrepiece of every meal
- Honda and Nissan expected to begin merger talks
- 'Draconian' Vietnam internet law heightens free speech fears
- Israeli women mobilise against ultra-Orthodox military exemptions
- Asian markets track Wall St rally as US inflation eases rate worries
- Tens of thousands protest in Serbian capital over fatal train station accident
- Trump vows to 'stop transgender lunacy' as a top priority
- 'Who's next?': Misinformation and online threats after US CEO slaying
- Only 12 trucks delivered food, water in North Gaza Governorate since October: Oxfam
- Langers edge Tiger and son Charlie in PNC Championship playoff
- Explosive batsman Jacobs gets New Zealand call-up for Sri Lanka series
- Holders PSG edge through on penalties in French Cup
- Daniels throw five TDs as Commanders down Eagles
- Atalanta fight back to take top spot in Serie A, Roma hit five
- Mancini admits regrets over leaving Italy for Saudi Arabia
- Run machine Ayub shines as Pakistan sweep South Africa
- Slovak PM Fico on surprise visit to Kremlin
- 'Incredible' Liverpool must stay focused: Slot
- Maresca 'absolutely happy' as title-chasing Chelsea drop points in Everton draw
- Salah happy wherever career ends after inspiring Liverpool rout
- Three and easy as Dortmund move into Bundesliga top six
- Liverpool hit Spurs for six, Man Utd embarrassed by Bournemouth
- Netanyahu vows to act with 'force, determination' against Yemen's Huthis
- Ali hat-trick helps champions Ahly crush Belouizdad
- Salah stars as rampant Liverpool hit Spurs for six
- Syria's new leader says all weapons to come under 'state control'
- 'Sonic 3' zips to top of N.America box office
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- Mbappe strikes as Real Madrid down Sevilla
- Pope again condemns 'cruelty' of Israeli strikes on Gaza
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- Troubled Man Utd humiliated by Bournemouth
- 2 US pilots shot down over Red Sea in 'friendly fire' incident: military
- Man Utd embarrassed by Bournemouth, Chelsea held at Everton
- France awaits fourth government of the year
- Death toll in Brazil bus crash rises to 41
- Odermatt stays hot to break Swiss World Cup wins record
- Neville says Rashford's career at Man Utd nearing 'inevitable ending'
- Syria's new leader vows not to negatively interfere in Lebanon
- Germany pledges security inquest after Christmas market attack
- Putin vows 'destruction' on Ukraine after Kazan drone attack
Global stocks sink on US inflation surge
World stock markets fell Friday on fears the Federal Reserve will move more aggressively to tighten monetary policy to tame decades-high inflation.
London equities also slid as investors set aside rebounding 2021 economic growth to focus on shrinking December activity in the wake of the Omicron Covid variant.
The UK economy grew by a record 7.5 percent last year to rebound from the pandemic crash, but shrank by a modest 0.2 percent in the final month, official data showed.
In the eurozone, Frankfurt and Paris stocks banked lower, mirroring Asia after overnight Wall Street losses.
The euro retreated versus the dollar, while oil prices rose after the International Energy Agency lifted its world oil demand forecast.
- US inflation shock -
"It's been quite a week for the markets with a shock from US inflation growing faster than expected," said investment director Russ Mould at stockbroker AJ Bell.
"Now we've got confirmation that Omicron tripped up the UK economy in December, albeit by a smaller amount than forecast."
Wall Street equities tumbled on Thursday as markets bet that the latest inflation data would spark swift action from the Fed.
The 7.5-percent jump in US consumer prices last month was the fastest in 40 years and reinforced fears that the central bank is falling behind the curve in keeping it under control.
Sentiment was also hit by remarks from Fed official James Bullard, who said he wanted to see interest rates lifted one percentage point by the start of July.
The St Louis Fed boss said he was in favour of a 50 basis point lift next month -- double the usual rise and the first since 2000 -- and two more after that.
"I'd like to see 100 basis points in the bag by July 1," Bullard, who has a vote on policy this year, told Bloomberg News. "I was already more hawkish but I have pulled up dramatically what I think the committee should do."
He added: "I do not think it is shock and awe.
"I think it is a sensible response to a surprise inflationary shock that we got during 2021 that we did not expect."
Bullard also said he was open to a very rare announcement of rate hikes between meetings, which further rattled traders who fretted about a move before March, while calling for the quick reduction of the bank's bond holdings that have helped keep rates subdued.
US Treasuries -- a guide to future borrowing costs -- have risen above two percent and analysts are predicting up to seven Fed rate hikes this year.
Separately on Friday, the IEA ramped up its 2022 demand outlook to 100.6 million barrels of crude oil per day, an increase of 3.2 million, as governments further ease Covid restrictions.
- Key figures around 1120 GMT -
London - FTSE 100: DOWN 0.8 percent at 7,612.98 points
Frankfurt - DAX: DOWN 0.7 percent at 15,386.18
Paris - CAC 40: DOWN 1.2 percent at 7,017.45
EURO STOXX 50: DOWN 1.1 percent at 4,149.77
Hong Kong - Hang Seng Index: DOWN 0.1 percent at 24,906.66 (close)
Shanghai - Composite: DOWN 0.7 percent at 3,462.95 (close)
Tokyo - Nikkei 225: Closed for a holiday
New York - Dow: DOWN 1.5 percent at 35,241.59 (close)
Euro/dollar: DOWN at $1.1384 from $1.1428 late Thursday
Pound/dollar: DOWN at $1.3548 from $1.3557
Euro/pound: DOWN at 84.03 pence from 84.29 pence
Dollar/yen: UP at 116.05 yen from 116.01 yen
Brent North Sea crude: UP 0.4 percent at $91.73 per barrel
West Texas Intermediate: UP 0.4 percent at $90.26 per barrel
J.V.Jacinto--PC