You are here
Europe: Shares dip on new Trump tariff threat
[MILAN] European shares fell slightly on Friday after US President Donald Trump warned of further tariffs on China, although losses were limited by gains among defensive stocks like utilities.
The pan European STOXX 600 fell 0.45 per cent by 0707 GMT, erasing only part of the 2.4 per cent gain in the previous session and remained on track for a small weekly gain.
Mr Trump on Thursday directed US trade officials to identify tariffs on US$100 billion more Chinese imports, upping the ante in an already high-stakes trade confrontation between the world's two largest economies.
The new warning however did not appear to change the prevailing view among investors that a full blown trade war that could threaten global growth is unlikely.
"Markets will now watch both the rhetoric from Trump's cabinet members and China's response to assess whether risk of a trade war is materially higher," said Credit Suisse in its investment daily. "We continue to see a trade war as unlikely".
However caution dominated, prompting investors into stocks like utilities seen as more resilient to possible trade escalations. French utility Suez led the sector higher, further boosted by a bullish broker note.
Elsewhere among top movers was Dufry, up 3.5 per cent after the Swiss retail company proposed a higher than expected dividend, while Telecom Italia rose 2.2 per cent after Italian state lender CDP said it would buy a stake of up to 5 per cent in the telecoms company.