Global stock markets have come under pressure amid fears that shares - boosted by the election of Donald Trump - may be at their most overvalued in 17 years.

London's FTSE 100 Index was more than 70 points, or 1%, lower in early trading - though it later pared back some of the losses. It added to falls in the previous session.

Markets in Europe also saw declines. It followed falls in Asian stocks overnight with Japan's Nikkei down 2% and Hong Kong's Hang Seng more than 1% lower.

That came after a drop of more than 1% for New York's S&P 500 on Tuesday, Wall Street's biggest sell-off since before Mr Trump's election in November.

The losses were prompted by investors dumping risky assets and shifting over to safe havens such as gold and bonds - parcels of government debt.


It follows a poll by Bank of America Merrill Lynch that found 34% of investors believed shares were the most overvalued of all asset types.

That was the highest proportion in 17 years, with US stocks identified as the most expensive.

Image: Japan's Nikkei fell

Markets had climbed to new record highs after Mr Trump's election signalled corporate tax cuts as well as a programme of infrastructure spending.

But investors are now anxious about whether he can deliver on his plans, as the White House struggles to push through its overhaul of healthcare.

Ken Odeluga, market analyst at City Index, said: "Storm clouds gathering over President Donald Trump's legislative agenda have triggered Wall Street's biggest slide since October."

Michael Hewson, chief market analyst at CMC Markets UK, said: "The question being asked is whether the scales are starting to fall away from investor's eyes as to whether President Trump will be able to deliver anything close to what has been priced into markets since his election last November.

"Even the mistiest eyed optimist appears to be coming to the realisation that even on health care where there is some form of consensus, that reforms are likely to take a lot longer than realised and as such any other programmes like tax and banking reform and infrastructure spending are likely to get pushed further out into the future."

In London, the FTSE 100 fell by more than 50 points on Tuesday though that was largely attributed to the strengthening pound following higher than expected inflation figures.

A stronger pound means foreign currency earnings by the FTSE's global companies translate into lower sterling value when brought home.