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European shares sink after Trump trade threats

Published 08/02/2019, 03:26 PM
Updated 08/02/2019, 03:30 PM
European shares sink after Trump trade threats
PIRC
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STOXX
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SX8P
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SXAP
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(For a live blog on European stocks, type LIVE/ in an Eikon
news window)
Aug 2 (Reuters) - European stock indexes lost up to 2% in
value in early deals on Friday as U.S. President Donald Trump's
warning of new tariffs on China sank stock markets worldwide and
sent trade-sensitive sectors like mining and carmakers into a
tailspin.
Abruptly ending a temporary trade truce between the two
countries, Trump said he would impose a 10% tariffs on $300
billion of Chinese exports to the United States from September
1. Spooking investors further, Bloomberg reported that Trump is
scheduled to make a statement on trade with the European Union
at 1745 GMT on Friday. By 0711 GMT, the pan-European benchmark stocks index STOXX
600 .STOXX was down 1.6% with the basic material sector
plunging 4.3%, followed by the auto .SXAP and tech sectors
.SX8P both down more than 2.5%.
Germany's DAX, often regarded as among the most sensitive
markets to trade nerves, fell 2% while France's CAC 40 fell
similarly.
Italian tyremaker Pirelli PIRC.MI added to the car
industry woes, slipping 4.7% after it cut revenue guidance for
the second time this year, the latest of a string of suppliers
to be hit by a broader auto industry downturn.
The trade escalation spurred flight to safer asset which saw
rally in German bonds, whose yields hit all time lows.

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