By Riva Gold 
   -- European stocks rebound 
 
   -- Asia markets recover 
 
   -- Walgreens up in premarket trading 

Stocks around the world recovered most of their losses Wednesday after escalating worries about U.S.-China trade relations triggered a selloff in the previous session.

The Stoxx Europe 600 rose 0.8% to erase Tuesday's decline, following broad-based gains across Asian markets. Futures pointed to a 0.3% opening rise for the S&P 500.

Investors this week have been more seriously considering the chance that the world's two largest economies could embark on a growth-hindering trade war, although many still expect the two countries to ultimately dial down their plans.

Stocks, commodities and bond yields fell Tuesday after President Donald Trump called for his administration to identify $200 billion in Chinese goods for a fresh round of tariffs.

"Our base case is this gets walked back [...] but it's getting more serious now," said Tim Courtney, chief investment officer at Exencial Wealth Advisors. "The longer it goes on and the further we go down this path, the greater the chances are that this could actually stick."

In U.S. premarket trading, shares of Walgreens Boots Alliance led gains in the S&P 500 in the wake of news it would be added to the Dow Jones Industrial Average, replacing General Electric.

Shares of 21st Century Fox rose 6% and Walt Disney edged up 1.7% premarket after the companies announced a new merger agreement Wednesday, increasing the value of the deal and adding a cash component.

Among decliners, shares of Starbucks fell 3.7% after it said it will close 150 U.S. stores in its 2019 fiscal year while Oracle dropped 3.8% after it warned currency conversations would weaken the company's quarterly performance.

In Europe, bank shares led most of the day's climb, while shares of basic resources companies added 1.7% as oil and industrial metals prices mostly moved higher, recovering Tuesday's declines.

Sectors more reliant on foreign revenue -- such as food and beverage and auto companies -- lagged behind more domestically focused ones such as banks. Europe's food and beverage sector generates roughly 69% of its revenue outside Europe, according to FactSet.

Foreign revenues are just one source of a company's potential exposure to a trade shake-up, however, analysts say.

"If it carries on, it's a sort of domino effect because global supply lines are so integrated [...] you'd start to worry about a more global downturn if it did escalate," said Chris Iggo, chief investment officer of fixed income at AXA Investment Managers.

More broadly, because of how late it is in the economic cycle and the fact that global expansion may be somewhat past its peak, "anything that's a threat to growth takes on a larger importance," he added.

Earlier, Japan's Nikkei Stock Average rose 1.2% and Hong Kong's Hang Seng advanced 0.8%, after falling 1.8% and 2.8%, respectively, Tuesday.

Shares of ZTE, a company at the center of recent U.S.-China tensions, rose 20% in Hong Kong after falling 25% in the previous session.

The Shanghai Composite Index edged up 0.3% after falling 3.8% Tuesday, narrowly avoiding a fall into bear market territory.

South Korea's Kospi closed higher for the first time in six sessions while Australia's S&P ASX 200 index rose 1.2% to its highest close since January 2008 with support from shares of banks.

Outside stocks, yields on 10-year Treasurys inched slightly higher to 2.901% from 2.893% Tuesday afternoon, signaling a small decline in prices. G old fell 0.2% to $1,275 an ounce.

Write to Riva Gold at riva.gold@wsj.com

(END) Dow Jones Newswires

June 20, 2018 09:02 ET (13:02 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.