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The share market suffered its biggest setback in weeks, tumbling more than 140 points after weak US manufacturing data and trade jitters triggered a global retreat.

The ASX 200 dived 144 points or 2.1 per cent to 6718, by mid-session, erasing more than a week of gains. The fall set the index on course for its worst loss since a 147-point slump in early October.

World markets hit reverse overnight after soft US data revived recession fears and US President Donald Trump blindsided trading rooms by announcing tariffs on South American imported metals. The S&P 500 dropped 0.86 per cent, its largest loss in nine weeks. European markets declined more than 2 per cent.

That left no hiding place for local traders as all 11 sectors fell more than 1 per cent. The dollar jumped almost a cent overnight to 68.17 US cents, denting exporters and companies that earn most of their income overseas.

Several companies that traded at record highs yesterday were ripe for profit-taking. Health giant CSL, which generates much of its revenue overseas, dropped 1.7 per cent. Cochlear shed 2 per cent, Fortescue Metals 1.8 per cent, and Macquarie Group 2.2 per cent. Supermarkets Coles and Woolworths both shed more than 2.9 per cent.

The tech sector, which tends to wax and wane with global sentiment, tumbled 2.6 per cent. Wisetech shed 4.8 per cent, Technology One 3.4 per cent and Nearmap 3.2 per cent.

Several of the banks set multi-month lows. ANZ dropped 1.5 per cent to its weakest level since early January. Westpac declined 1.2 per cent towards its worst close since January. NAB slid 1.8 per cent to a level last seen in May.

Caltex largely overcame a weak open after the board of directors rejected a takeover proposal from a Canadian convenience store chain, but encouraged a higher offer. The board said the offer undervalued the company, but it would provide Alimentation Couche-Tard with additional information for a revised offer. Shares eased 0.7 per cent to just below the current offer price of $34.50.

The Reserve Bank met this morning and is due to announce any change to the cash rate along with a policy statement at 2.30pm EST.

Asian markets chased Wall Street lower. China’s Shanghai Composite gave up 0.5 per cent, Hong Kong’s Hang Seng 1.4 per cent and Japan’s Nikkei 1.1 per cent. S&P 500 index futures were steady.

Brent crude futures rose 13 cents or 0.2 per cent this morning to $US61.05 a barrel. Gold was flat at $US1,469.20 an ounce.

What’s hot today and what’s not:

Hot today: Red Emperor Resources was one of the few stocks not to see red this morning after the oil and gas explorer secured an option over a promising black off WA. The explorer’s market capitalisation almost doubled in early action before easing to a gain of 44.4 per cent. The company announced it had signed a binding letter of intent to secure an option to acquire a 70 per cent interest in a block in the North Perth basin. Red Emperor will fund geological studies and pay joint venture partners Pilot Energy and Key Petroleum $500,000.

Not today: pokie-machine maker Ainsworth hit a seven-year low as investors continued to bail following last week’s underwhelming AGM. The company told investors it was relying on a turnaround in the second half of the financial year after predicting a loss of $4 million for the six months to December 31. Markets have been soft in both Asia and at home, with revenues down 11.8 per cent on the same period last year. The share price was last down 8.4 per cent at a level last seen in February 2012.

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