The trade war has hit Europe: stock indexes are in the red

Shares of European banks and retail companies came under pressure after Donald Trump announced the introduction of new tariffs on imports. Trump announced a 10% tariff on all foreign imports to the United States, and tariffs will be even higher for some trading partners. This decision is aimed at combating alleged unfair trade practices. 

The European Union was among the countries that are subject to the «retaliatory» tariffs of the United States. The White House considers them unscrupulous players in international trade, and has imposed 20% tariffs on the EU. Against the background of this news, the index of eurozone creditors fell by 2.8%, and analysts warned of a possible recession if the policy of duties continues. They also believe that the ECB may accelerate interest rate cuts to stimulate the economy. 

The broader European stock indexes were in the red zone: the German DAX lost 2.3%, the French CAC 40 declined by 2.2%, and the British FTSE 100 sank by 1.5%. 

Shares of banks in Italy and Spain, including Banco Santander, Banca Monte dei Paschi di Siena and Unicredit, lost more than 2%. Luxury goods manufacturers such as Pandora, Richemont, LVMH and Kering are also under pressure as the EU and Switzerland face new US tariffs.