The Globe and Mail reports in its Friday edition that U.S. and Canadian stocks fell sharply Thursday, giving up much of their previous day's gains as rising tensions between Washington and Beijing affected optimism about the global trade war and its economic impact. The Globe's Darcy Keith writes that the S&P 500 Index fell 3.5 per cent, following a 9.5-per-cent surge after President Donald Trump's move to pause tariffs. The Dow dropped 2.5 per cent, and the Nasdaq tumbled 4.3 per cent. Canada's S&P/TSX Composite Index lost 3 per cent after a 5.4-per-cent rally on Wednesday. The Canadian dollar rose to a near five-month high against the greenback, as investors reduced their exposure to U.S. financial markets, anticipating that the global trade war could upend a period of outperformance for the American economy. The loonie was trading 0.6 per cent higher at 1.3995 per U.S. dollar by late day, or 71.45 U.S. cents. CIBC's Noah Buffam says: "We're seeing a bit of repatriation out of U.S. assets. The market is reassessing how exceptional the U.S. is over a longer-term period." The U.S. Labor Department's Consumer Price Index report showed that consumer prices for a basket of goods unexpectedly fell in March.