European markets fall as Trump vows to respond to EU counter-tariffs!
European markets opened lower as global tariff tensions heated up, following US President Donald Trump's pledge to respond to EU counter-tariffs. The European response came after the US imposed 25% tariffs on aluminium and steel imports. " Whatever they tax us with, we're charging them back," Trump said of the EU's counter-measures. Britain's FTSE 100 fell 0.1% on Thursday morning, with Germany's DAX index also down 0.4%. France's CAC 40 index fell 0.3% on Thursday morning, while the STOXX 600 fell 0.1%. All of these indices then rose slightly later in the morning.
Canada also revealed on Wednesday that it would impose tariffs on about 30 billion Canadian dollars (19.2 billion euros) worth of American goods. Ontario Premier Doug Ford had also suggested a 25% surcharge on electricity sent to American consumers, although he withdrew that on Tuesday. Trump had said he would double planned tariffs on Canadian steel and aluminum imports to 50% on Tuesday, another proposal that has since been withdrawn.
Investors are also looking forward to the U.S. Federal Reserve's policy meeting next week, which is expected to shed more light on when future rate cuts might occur. Asia-Pacific shares fell overnight as slowing U.S. inflation failed to reassure investors, with concerns about a possible U.S. recession still looming. Japan's Nikkei 225 benchmark closed about 0.1% lower on Thursday at 36,790.03, trading near six-month lows.
China’s Shanghai Composite Index fell 0.4% on Thursday to close at 3,358.7, falling for a second session, mainly dragged down by AI and technology-related stocks. UBS recently downgraded China’s tech sector to neutral from attractive. This was largely due to the revaluation driven by hoarding, uncertainty over future growth, as well as tariff risks. Similarly, Hong Kong’s Hang Seng Index also closed about 0.6% lower, at 23,462.6. Australia’s S&P/ASX 200 also fell about 0.5% to 7,749.1 on Thursday, while South Korea’s Kospi fell less than 0.1% to 2,573.6.
The S&P 500 closed 0.5% higher on Wednesday, boosted by a better-than-expected February inflation report that showed price pressures rose 2.8% year-on-year last month. That was slightly below analysts’ expectations of 2.9%, and down from January’s 3% pace. Investors have priced in at least three quarters of interest rate cuts through 2025, with the first expected in June.
The NASDAQ 100 also closed about 1.1% higher on Wednesday. The Dow Jones Industrial Average, on the other hand, fell 0.2%. In commodities, U.S. crude oil fell 0.5% to $67.4 a barrel on Thursday morning, with Brent crude also down 0.4% to $70.2 a barrel. Gold, on the other hand, traded up 0.2% on Thursday, near record highs. The EUR/USD pair fell about 0.2% on Thursday morning, with the EUR/GBP pair trading mostly unchanged.
German fashion retailer Hugo Boss reported group sales of 4.3 billion euros in 2024, along with earnings before interest and taxes (EBIT) of 361 million euros. Free cash flow amounted to €497 million. The company expects group sales this year to be somewhere between 4.2 billion and 4.4 billion euros, while earnings before interest and taxes (EBIT) is estimated to increase to somewhere between 380 and 440 million euros.
Hugo Boss shares rose 2% on the Euronext index on Thursday morning. Italian insurance company Generali Group also posted record results, with adjusted net income rising 5.4% to 3.8 billion euros, while operating profit rose 8.2% to 7.3 billion euros. Generali's share price was up 0.1% on the Milan stock exchange on Thursday morning. Italian electricity and gas company Enel will also report earnings after the market closes on Thursday.
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