SINGAPORE - Global stocks treaded with caution on Thursday, with Asian shares feeling the heat as US President Donald Trump's tariff plans, geopolitical worries and a cautious stance from Federal Reserve policymakers hurt risk sentiment.

The risk-off mood lifted gold prices to a record high, while the safe-haven Japanese yen firmed to its highest level since early December against the dollar.

European futures pointed to a muted open on Thursday, a day after the pan-European STOXX 600 index dropped nearly 1 percent, its biggest daily drop in two months. Futures for S&P 500 and Nasdaq eased 0.3 percent.

Trump through the week has vowed tariffs on wide-ranging imports including pharmaceuticals products, semiconductor chips and lumber. He intends to impose tariffs on autos as soon as April 2.

That along with other threats has exacerbated fears of a broad trade war, leaving investors nervous, although some analysts see the moves by Trump as negotiating tactics.

Market jitters escalated on geopolitical worries after Trump alarmed European officials by denouncing Ukrainian President Volodymyr Zelenskiy as a "dictator", amid US talks with Russia to end the Ukraine conflict.

The yen hit an over two-month high against the dollar and was last up 0.9 percent at 150.065 per dollar. The yen has risen more than 4 percent against the dollar this year boosted by rising odds of the Bank of Japan hiking rates again in 2025.

"Uncertainty about the Fed's policy and Trump’s tariffs will continue to rattle markets and keep investors on edge, with no end in sight in the short term," said Vasu Menon, managing director of investment strategy at OCBC Bank in Singapore.

"Investors must come to terms with the fact that volatility will be more elevated this year ... There are valid reasons to remain sanguine about the investment outlook especially for those with the risk appetite and patience."

In Asia, Japan's Nikkei slid 1.5 percent on the strong yen. Hong Kong's Hang Seng Index slipped 1.3 percent, having touched a four-month high earlier this week boosted by tech stocks in the wake of Chinese startup DeepSeek's breakthrough.

Trump's initial policy proposals raised concern at the Fed about higher inflation, with firms telling the US central bank they generally expected to raise prices to pass along the cost of import tariffs, according to the Fed's January meeting minutes released on Wednesday.

"Trump's policies ... no doubt added complexity to the Fed's balancing act between inflation and employment, forcing policymakers to lean into a wait-and-see approach," said Yeap Jun Rong, market strategist at IG.

"That said, with market expectations already well aligned for a rate hold over the next two FOMC meetings, the minutes served more as confirmation of existing sentiment."

Traders are pricing in 39 basis points of cuts this year from the Fed with the next move fully priced in for September, LSEG data showed.

The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, eased 0.16 percent to 107.06. The euro was steady at $1.0428.

Gold prices rose to a fresh record high of $2,947.11 an ounce, reaching a new peak for the tenth time this year. The yellow metal is up 12 percent so far in 2025 after rising 27 percent last year, its strongest annual performance in over a decade.

Oil prices eased away from a one-week high while wheat extended gains to a fifth session to trade near its highest close since October, underpinned by worries that cold weather in Russia and the US could damage the crop.