European Stocks Fall From Record as Trump Ramps Up Tariff Threat
European stocks fell from a record high on worries that the region could be caught in a trade spat with the US. Automakers sank as President Donald Trump threatened 25% tariffs.
The Stoxx 600 index dropped 0.5% by the close after Trump made a series of apparently contradictory comments about his plans to enact levies on the European Union. He said Thursday tariffs on Canada and Mexico are on track to go into place on March 4, and that he would impose an additional 10% tax on Chinese imports.
Automakers, beverage stocks and miners are among sectors most at risk due to their large overseas sales. Shares of companies including Stellantis NV, Volkswagen AG and Remy Cointreau SA all fell.
Panmure Liberum strategist Joachim Klement said while the risk of inflation as a result of retaliatory tariffs from Europe was small, growth may slow substantially, depending on which goods are targeted. “The best place to hide for investors are services companies, in particular travel and leisure,” he added.
Europe’s main equity benchmark has rallied over 9% this year on the back of upbeat corporate earnings and bets on improving economic growth and closed at a record on Wednesday. However, the possibility of a trade war with the US has weighed on sentiment.
Source : Bloomberg
