Stocks battered by Wall Street, fears of United States slowdown

Asian stocks slid on Wednesday, dragged down by Wall Street's tumble as sharp declines in long-term U.S. Treasury yields and resurgent trade concerns stoked investor worries about global economic growth.

The so-called "inversion" of the yield curve to many investors sounds an alarm about a looming USA economic slowdown.

The euro EUR=EBS edged down 0.1 percent to $1.1328.

According to the San Francisco Fed, each of the nine USA recessions that have occurred since 1955 came between six months and 24 months after a an inversion in the yield curve of two-year and 10-year Treasury yields.

"In the initial phase of the inversion of the yield curve markets are anxious and react more aggressively to weak data than to strong data", said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.

The yield on the five-year Treasury dropped below the two-year and three-year Treasury yields on Monday. A hint at rate cuts coming down the pipeline would offer much needed breathing room for emerging market (EM) currencies and move funds from USA government bonds to other havens of interest returns causing them to appreciate against the dollar.

That pushed MSCI's all-country index down 0.4 percent.

Australian stocks lost 1 percent, pressured by global losses.

"Inversion of that curve is the real recession red flag", said Neil Wilson, Chief Market Analyst at Markets.com.

Spot gold eased 0.4 percent to $1,236.11 an ounce after touching its highest level since October 26 at $1,241.86 an ounce on Tuesday.

The yield curve shows the returns on bonds of different maturities, from a few months on the so-called short end to as long as 100 years on some corporate bonds.

If wages are rising at a quick pace, Fed members may be more apt to continue to hike interest rates to try to stay ahead of inflation.

It is not a sure indicator, however, with an inversion in 1966 and a very flat curve in 1998 failing to lead to recessions. Adding to the risk aversion was news that U.K. Prime Minister Theresa May's push to avoid a so-called "hard Brexit" may be at risk.

Trump threatened on Tuesday to place "major tariffs" on Chinese goods imported into the United States if his administration is unable to reach an effective trade deal with Beijing.

Recessionary pressures could be exacerbated if fears surrounding the US-China trade war are resumed following a 90-day truce, agreed at the G20 in Argentina last week.

Against a basket of six rivals .DXY , the dollar edged up 0.1 percent to 97.103, trimming this week's losses to 0.2 percent.

Lyngen said the inversion of three- and five-year yields had increased the likelihood that an inversion of the two- and 10-year yield would happen by early 2019.

The dollar was 0.77 percent lower against the Japanese yen, which tends to benefit during geopolitical or financial stress as Japan is the world's biggest creditor nation.

Oil prices fell, weighed down by swelling USA inventories and concerns that slowing economic activity will sap demand for commodities. U.S. West Texas Intermediate (WTI) crude futures rose 37 cents to $53.62 a barrel.