Equities Rally Slows as Trump Threatens 25% Tariffs – Europe Market Wrap
Trump’s most recent tariff threats fuelled fears of a growing trade war, causing Europe’s equity surge to stall and bonds to continue their decline.
The Stoxx 600 Index fell 0.4% after reaching a new high on Tuesday, with the latest earnings reports further dampening optimism. Glencore shares fell to their lowest level in more than three years as the commodities trading behemoth reported a drop in profits.
Trump proposed taxes of up to 25% on automotive, semiconductor, and pharmaceutical imports. His remarks exacerbated the precarious picture for markets this week, as tentative hopes for an end to the war in Ukraine were dampened by the exclusion of Ukrainian and European officials from US-Russia talks on Tuesday.
Some investors are also apprehensive about the results of Germany’s national election on Sunday. While Friedrich Merz of the centre-right opposition is projected to become chancellor, surveys indicate that the far-right Alternative for Germany will become the second-largest party in parliament.
ECB’s Schnabel: Restriction has come down significantly, up to a point where we can no longer say with confidence that our monetary policy is still restrictive.
