World markets face longest losing streak since Jan 2016

LONDON, Sept 10 (Reuters): World shares were flirting with their longest run of declines since early 2016 on Monday, hit by rising anxiety about the US-China trade war and another interest rate increase by the Federal Reserve later this month.

Europe defended its ground early on, but it was proving a struggle after a fresh sell-off by Chinese shares pulled Asian and emerging-market equities to 14-month lows.

Traders were bracing for a potential escalation in the Sino-US tariff row after US President Donald Trump raised the stakes in the dispute on Friday.

He said he was ready to impose tariffs on virtually all Chinese imports into the United States, threatening duties on another $267 billion of goods in addition to the $200 billion already facing threatened tariffs.

On top of that, strong US jobs numbers on Friday had bolstered bets on a higher dollar on expectations the Federal Reserve will keep raising US interest rates.

"It's more of the same, markets continue to be under pressure from a whole host of headwinds," said fund manager GAM's Investment Director of emerging market equities, Tim Love.