European shares are trading lower Monday as elevated trade tensions weigh on investor sentiment. US President Donald Trump has stepped up his tariff rhetoric and is also reportedly planning to bar Chinese companies from investing in US tech firms.
A disappointing German Ifo survey also exacerbated the weaker tone.
By 1210 BST, the EUROSTOXX 600 was 1.14% lower, while the EUROSTOXX 50 was off 1.09%. Regional bourses were also negative. The German DAX fell 1.41%, the French CAC was 0.85% in the red and the Spanish IBEX lost 1.24%.
Trade tensions escalate
The Monday trading session has begun amid further comments from US President Trump on the US’ trade and tariff plans.
The President tweeted that the US could add further import tariffs if the countries trading partners don’t withdraw their new, higher tariffs.
“The United States is insisting that all countries that have placed artificial Trade Barriers and Tariffs on goods going into their country, remove those Barriers & Tariffs or be met with more than Reciprocity by the U.S.A. Trade must be fair and no longer a one way street!,” the President said.
In addition, news reports state that the US is also preparing to confirm tougher rules against Chinese companies and their involvement with US tech.
Worries stemming from this ongoing trade dispute are unsettling investors as the end result could mean real changes to business, profits and performance at a number of different firms who rely on international trade for much of their revenues.
Auto stocks are lower again, with Daimler sinking 2.65%, Volkswagen shares losing 2.09%, BMW shares off 1.78% and Fiat shares down 0.90%.
German Ifo disappoints
The publication of the German June Ifo survey has also hit investor sentiment in Europe. The headline Ifo business index slipped to 101.8 in June from May’s 102.3.
“The index fell markedly in trade. Companies downwardly revised their very good assessments of the current business situation. Their business outlook turned slightly pessimistic for the first time since February 2015. Indicators dropped far more sharply in retailing than in wholesaling,” said Ifo President Clemens Fuest.