Paris (AFP) – World equity markets were under pressure Friday as analysts ran out of ways to justify current Trump-inspired stock valuations, but some said the party may be far from over.

The dollar came under more pressure and Asian and European markets saw fresh losses after Treasury Secretary Steven Mnuchin lowered US growth expectations and appeared to temper Donald Trump’s belligerence towards China’s currency policy.

“Investors around the globe continue to watch in awe and disbelief as the stocks continue to climb ever higher,” said Mati Greenspan, Senior Market Analyst at eToro.

“Many analysts feel that this has been overdone but most agree that it could very well continue for a while,” he said.

Most Asian markets closed lower Friday and Europe’s main exchanges also plunged into the red in early business.

After New York’s blue-chip Dow index hit a gravity-defying record tenth successive all-time high Thursday, the Trump-fuelled global rally is showing signs of petering out with analysts suggesting the exuberance about hoped-for spending and tax cuts may have been overdone.

– ‘Dangling’ –

That appeared evident after Mnuchin forecast three percent growth by the end of next year, warning that the effect of certain measures would take time. That compared with the four percent Trump promised on the campaign trail.

In an interview with CNBC, Mnuchin also appeared to wind back on his boss’s earlier threats to call China a currency manipulator, easing concerns about a possible trade stand-off between the world’s top two economic powers.

Stephen Innes, senior trader at OANDA, said in a note the comments “have left investors dangling about the US administration’s currency policy as there appears to be a subtle shift in the Trump administration’s rhetoric”.

The comments overshadowed his promise to push through tax cuts by August, and pursue deregulation on companies and banks.

– Dollar retreats –

The dollar lost ground against its major peers, another sign that cracks may be appearing in investors’ belief that US economic strength will make them richer day after day.

Mexico’s peso surged more than one percent against the dollar, levels not seen since just after Trump’s November 8 election win as the country’s leaders stand up to the new US administration’s threats over trade, a border wall and immigration. The peso is up 10 percent from record lows touched last month.

A visit to Mexico by Secretary of State Rex Tillerson to meet its leaders also calmed nerves after Trump’s hardline rhetoric on the country.

Asian equity markets extended the previous day’s losses.

“There are those out there thinking, ‘Well, markets have had such a big runup, it’s time to take a bit of money off the table,'” Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors, told Bloomberg News.

“It wouldn’t surprise me to see a bit of consolidation or correction, and maybe we’re starting to see signs of that.”

In corporate Europe, some heavyweights saw heavy losses in response to annual results.

Vivendi in Paris dropped nearly six percent after posting a 35-percent decline in net profit.

Royal Bank of Scotland shares dropped more than four percent in London after the bank’s net loss widened to £7 billion in 2016.

Frankfurt heavyweight BASF shed close to three percent after the chemicals giant reported a “challenging” 2016, leaving it just “cautiously optimistic” for the current year.

– Key figures around 1100 GMT –

London – FTSE 100: DOWN 0.6 percent at 7,226.78

Frankfurt – DAX 30: DOWN 0.9 percent at 11,846.70

Paris – CAC 40: DOWN 0.9 percent at 4,846.87

Tokyo – Nikkei 225: DOWN 0.5 percent at 19,283.54 (close)

Hong Kong – Hang Seng: DOWN 0.6 percent at 23,965.7 (close)

Shanghai – Composite: UP 0.1 percent at 3,253.43 (close)

New York – Dow: UP 0.2 percent at 20,797.61 (close)

Euro/dollar: UP at $1.0593 from $1.0579

Pound/dollar: DOWN at $1.2547 from $1.2556

Dollar/yen: DOWN at 112.37 yen from 112.67 yen

Oil – West Texas Intermediate: DOWN 25 cents at $54.20 per barrel

Oil – Brent North Sea: DOWN 24 cents at $56.58