European shares fell to their lowest levels in more than a month today on fears that US trade policies could dent growth after President Donald Trump doubled tariffs on imports of steel and aluminium products from Canada to 50%.
The pan-European STOXX 600 was down 1.7%, closing its fourth consecutive session lower, its longest losing streak since December.
The CAC in Paris was down 1.3% to 7,941, while the DAX in Frankfurt was down 1.29% to 22,328 and London’s FTSE index was down 1.2% to 8,495. Dublin’s ISEQ index was down 2.4% to 10,789.
Trump also threatened more tariffs on cars coming into the US next month, if other tariffs are not dropped by Canada.
Europe’s automobile and parts sector lost 1.9%.
Every tariff headline adds to investor worries that the 25% tariffs floated on the European Union could become a reality, although there is little clarity on their implementation.
“The new measures announced today don’t have anything to do with Europe, but that level of policy uncertainty puts investors a little bit more on edge than usual settings, we’re just seeing that kick in,” said Iain Barnes, chief investment officer at Netwealth.
Trump’s announcements have been a source of constant volatility in markets, with investors questioning to what extent they will materialize.
Travel and leisure stocks were the biggest losers, with IAG down 6.1%, Lufthansa losing 5.3% and Entain off 2.6%, after major US carrier Delta Airlines lowered its quarterly profit estimates due to US economic uncertainty.
On Wall Street, the Dow and the benchmark S&P 500 fell in choppy trading after the news.
Yesterday, the S&P 500 recorded its most significant one-day drop since December 18, wiping out a staggering $4 trillion from its recent peak. Meanwhile, the tech-heavy Nasdaq confirmed a 10% correction late last week.
