European markets set to plummet amid Trump tariff threat
Published On Feb 3, 2025, 12:55 AM
European markets are expecting a significant drop as a reaction to President Trump's recent tariffs on imports from Canada, Mexico, and China. The tariffs, which include a 25% tax on imports from Canada and Mexico, and a 10% tax from China, are set to take effect soon, leading to negative sentiment in the markets. The U.K.'s FTSE 100, Germany's DAX, France's CAC, and Italy's FTSE MIB are all expected to open lower. The tariffs have sparked fears of retaliatory actions from Canada and Mexico, and a potential tariff on the EU has been threatened, which may escalate trade tensions further.
Stock Forecasts
VGK
Negative
Investors may want to consider reducing exposure to European markets due to expected volatility and negative sentiment arising from the trade tariffs. The potential for retaliatory tariffs from affected countries could further weigh on market performance.
XLE
Positive
Given the rise in oil prices stemming from the tariffs, energy sector stocks might see some positive movement. Investors may consider focusing on energy ETFs or companies tied to oil production.
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