The US and China are heading towards an all-out trade war, after Donald Trump unleashed a fresh wave of tariffs against dozens of partners that triggered a fresh day of stock market turmoil on Wednesday.

Despite the market chaos, China’s government was unbowed, reiterating threats of further countermeasures and saying it was unwilling to fight a trade war but “will never sit idly by and watch the legitimate rights and interests of the Chinese people be damaged and deprived”.

The global economy has been rocked since sweeping 10% US tariffs took effect over the weekend, prompting dramatic market sell-offs worldwide and sparking recession fears.