European equities tumbled further on Friday, rounding off their worst week since Russia’s full-scale invasion of Ukraine in February 2022, amid rising investor concerns over the economic implications of sweeping tariffs announced by the United States.
By 11:00 Central European Time, the Euro STOXX 50 was down 2.2%, taking weekly losses to 5.9%. The broader Euro STOXX 600 index also fell 2.1%, extending its drop for the week to 5.4%. Major national indices followed suit, with Germany’s DAX losing 1.8%, France’s CAC 40 shedding 1.7%, and steep losses recorded in Southern Europe: Spain’s IBEX 35 dropped 4.1% and Italy’s FTSE MIB fell 3.9%.
Financial stocks led the rout. The Euro STOXX Banks index plunged 6.4% on Friday alone, bringing its weekly losses to 10%. Spain’s Banco Sabadell sank 9.4%, Societe Generale and Deutsche Bank both fell over 8%, while UniCredit, Banco BPM, and Intesa Sanpaolo all declined between 6.7% and 7.7%.
Tensions escalated on Wednesday when former U.S. President Donald Trump announced reciprocal tariffs on all countries, including a 20% levy on goods from the European Union.
The selloff extended to the energy sector, with Spanish oil major Repsol, Austria’s OMV, Dutch Shell, and Italy’s Eni all down between 2.8% and 3.6%. Brent crude dropped 3% on Friday to $67 per barrel, following a 6.6% fall the day before, marking its lowest level since August 2021.
“Investors are reacting to the estimated damage these tariffs could do to global trade, and therefore global economic growth. The size of the tariffs are such that business activity could slow sharply, leading to significantly lower demand for oil,” said David Morrison, senior market analyst at Trade Nation.
Consumer discretionary stocks also took a hit. Adidas slid 2.8% after a staggering 11.8% drop on Thursday. Luxury names were weaker too: LVMH (-0.8%), Richemont (-2.9%), and Moncler (-0.9%).
Source: Euronews
