European Stocks Slide for Fourth Session as Trump Hikes Tariffs
European stocks dropped for a fourth straight session after US President Donald Trump ratcheted up the trade war with Canada. Airline stocks slid after profit warnings from US carriers.
The Stoxx Europe 600 Index fell 1.7% to a five-week low, as Trump said he was doubling the tariffs on Canadian steel and aluminum to retaliate against Ontario’s move to place a levy on electricity sent to the US. Carmaker Volkswagen AG fell 1.1% after earlier rallying on results, while peer Stellantis NV slumped 5.2%.
Trump’s decision to raise the tariffs despite the slide in equity markets “showcases that his second mandate is about Main Street, not Wall Street,” said Mathieu Racheter, head of equity strategy at Julius Baer. “We don’t think the recent de-coupling of European equities’ performance from the US is sustainable.”
The travel and leisure subindex dropped 3.5% after American Airlines Group Inc. predicted its first-quarter loss would be roughly double its prior guidance, less than a day after Delta Air Lines Inc. cut its profit outlook in half. Utilities, energy and real estate outperformed.
Europe’s benchmark index has faltered after a strong start to the year as worries about slowing US economic growth temper optimism around an improving regional fiscal and political outlook. The Stoxx 600 has dropped 4.4% from its March 3 record, although that’s about half the plunge in the S&P 500 since its own February peak.
Germany’s DAX Index fell 1.3% as worries about the trade war and the US economy overshadowed hopes for a resolution on a dispute over domestic defense spending.
Source : Bloomberg
