(Reuters) - A look at the day ahead in European and global markets from Wayne Cole

Another day, another rout in Asian markets as President Trump shows no sign of backing away from his tariff plans despite the bonfire of wealth engulfing equity markets.

Investors had thought the spectre of trillions of dollars lost would make Trump reconsider, or at least shake his aides, but he seems to feel this harsh medicine will help in the long run. Billionaire fund manager Bill Ackman, who endorsed Trump's run for President, seemed to think otherwise, saying the tariffs were an "economic nuclear winter" for the world.

The chill was certainly felt in Asia where the Nikkei shed another 6% and Chinese blue chips almost 7%, despite talk that Beijing would come to the rescue with stimulus steps.

Poor Taiwan returned from a break with losses of almost 10% as Trump's sky-high levies threaten the supply chains that so much of the world's business has come to rely on. Taiwan's policymakers acted to curb short selling and circuit breakers were tripped in a host of markets.

Dealers were increasingly concerned the markets' losses would force investors to dump profitable assets just to cover their margin calls, leading to a self-fuelling fire sale.

JPMorgan now sees a 60% chance of a U.S. recession and Fed rate cuts from June to next January, leaving the funds rate around 3%. Futures markets were also moving that way, with the December Fed funds contract up an astonishing 30 basis points at one stage this morning, before paring that back to 16 ticks.

Markets even imply a 50-50 chance the Fed could ease as early as May, despite Chair Powell's reiteration last week that the central bank was in no hurry to move.

His reticence is understandable given how tariffs are set to lift the price of everything from cars to food. It's likely too early for the U.S. March consumer price report this week to show the impact, but that won't last for long.

Trump has said many countries were looking to do deals to ease the tariff pain. Problem is, the "reciprocal" U.S. rates chosen were much, much higher than the levies actually imposed by most other nations, making it hard for them to offer deals "beautiful" enough to satisfy Trump.

China seems ready for the fight, in part because it sees a chance to become the trade partner you can trust, replacing the U.S. There could also be more hints of EU reprisals when the region's trade ministers meet later on Monday.

All of this is happening just as the U.S. earnings season is due to start with major banks on Friday, and it will be a brave CEO who expresses anything but caution about the outlook for profits and sales.

Key developments that could influence markets on Monday:

- EU retail sales, Sentix investor confidence, German industrial output

- Appearances by ECB board member Piero Cipollone and Fed Governor Kugler