European Stock Markets Plunge as Trump’s Trade War Escalates
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April 4, 2025 Hour: 10:25 am
Over the last two days, European, Asian, and American stock markets have experienced sharp losses.
On Friday, European stock markets and the price of Brent crude oil plummeted after China announced its response to U.S. President Donald Trump’s trade war.
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Hours after opening, the main European markets were posting significant losses, led by Milan, which plunged 7.35%, followed by Madrid, down 6.04%, on a day when banks suffered losses exceeding 10%. Likewise, the Frankfurt Stock Exchange dropped 4.79%, Paris fell 4.36%, and London declined 3.95%.
The Euro Stoxx 50 index, which tracks the largest capitalized European companies, recorded a significant loss of 4.88%. Meanwhile, the euro strengthened against the greenback, trading at $1.105.
Futures for the main Wall Street indices, which had already been falling moderately at the opening of European markets, deepened their losses, signaling another session of sharp declines—up to 4% in the case of the tech-heavy Nasdaq.
European, Asian, and American stock markets have experienced two days of heavy losses. On Thursday, the announcement of global tariffs by Trump amplified fears of an impending recession.
Although losses in Europe were more moderate at the market open, they grew exponentially after news broke that China would impose a 34% tariff on U.S. imports starting April 10, restrict exports of rare earths to the U.S., and sanction certain companies.
Fears over the consequences of a global tariff war on the world economy triggered a collapse in other markets: Brent crude, Europe’s benchmark oil, tumbled 7.63% to $64.79.
On Thursday, Brent had already suffered a drop of more than 6%, amid concerns over how trade tensions could affect crude oil demand, and after the Organization of the Petroleum Exporting Countries and its allies (OPEC+), led by Saudi Arabia and Russia, decided to increase crude production by 411,000 barrels per day starting in May.
Meanwhile, the price of West Texas Intermediate (WTI) crude, which also plunged the day before, is currently seeing a steep drop of 8.74%, down to $61.10.
In other markets, gold prices rose moderately by 0.20%, reaching $3,129.28. In the bond market, yields on benchmark bonds fell: the German 10-year bond yield dropped to 2.499%, the U.S. bond to 3.897%, and the Spanish bond to 3.218%.
teleSUR/ JF
Source: EFE
