European stock markets slammed into reverse yesterday as Donald Trump’s tariffs fuelled fears of a damaging global trade war.
On a brutal day, the FTSE 100 retreated from the record high set the previous day, falling 1.3 per cent, or 112.31 points, to 8759. The FTSE 250 slipped 2.1 per cent, or 431.79 points, to 19,950.5.
The losses were mirrored on the Continent with the Dax down 3.5 per cent in Frankfurt, the FTSE MIB off 3.4 per cent in Milan and the CAC sliding 1.9 per cent in Paris.
The pan-European STOXX 600 index closed 2.1 per cent lower – its worst day since August 2024 – with car makers among the worst hit.
Wall Street also opened with heavy losses but recovered slightly later in the day.
At the same time, Brent crude fell towards $70 a barrel as the Opec+ cartel of oil producing nations agreed to increase output.
Trump effect: The pan-European STOXX 600 index closed 2.1% lower – its worst day since August 2024 – with car makers among the worst hit
The turmoil on global markets came after the US president’s swingeing tariffs on imports from Mexico, Canada and China took effect – and all three countries said they would retaliate.
Danni Hewson at trading platform AJ Bell said: ‘Donald Trump always said that he found the word “tariff” to be the most beautiful word in the dictionary.
‘He promised that a Trump presidency would put tariffs at the heart of its economic strategy, but he still managed to leave investors with a big enough question mark for a significant post-election market bounce.
‘That bounce is gone, with investors globally feeling more than a little shell-shocked.’
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