After the huge falls on Thursday and Friday, European stock markets lived another day of chaos for the commercial war unleashed By President Donald Trump and the Paneuropeo Eurostoxx 600 index lost around 5%.
They have also reported pronounced fallen Frankfurt (-4.30%), Paris (-3.9%), London (-3.80%) and Madrid (-4.4%).
In a few days, more than 1,500 million euros (US $ 1,640 million) of stock capitalization have vanished in Europe.
In Asia, Tokyo’s bag closed in red (-7.8%), just like those of Seoul (-5.6%), Sydney (-4.2%) and Taiwan (-9.7%).
Shanghai also sank (-7.34%) and in Hong Kong, the Hang Seng index closed with losses of 13.22%, its worst result since 1997, during the Asian financial crisis.
Wall Street, which in two sessions last week registered its worst day since 2020 with losses of about US $ 6 billion of capitalization, should also open down.
Trump unleashed a storm in the markets last week with the announcement of tariffs to countries around the worldincluding its main commercial partners, such as China and the European Union.
The president accuses them of “looting” and consequently decided to impose a 10% universal tariff on all products imported to the United States, which entered into force on Saturday, April 5.
As of Wednesday, tariffs should go into force for their main commercial partners, including the European Union (20%) and China (34%).
In Europe, foreign trade ministers met Monday in Luxembourg to “prepare” a joint response, asking for a “paradigm change” and without ruling out “extremely aggressive” measures against tariffs.
China already announced Friday 34% tariffs to all American products as of April 10.
He also imposed export controls to seven rare minerals, including gadolinio, which is used for magnetic resonances, and the IITRY, used in electronic consumer products.
The Deputy Minister of Commerce, Ling Ji, said that Chinese tariffs “firmly protect the legitimate rights and interests of companies, including Americans.”
Trump accuses China of being “the greatest abuse” of all in terms of tariffs and said that Beijing did not understand his warning “To the abusive countries not to take retaliation measures,” he wrote on his social truth network.
All affected sectors
The hopes of Trump reconsidering his policy vanished on Sunday, April 6 when he said that “sometimes you have to take medicine to fix something,” he said aboard the Air Force One.
“Until now, Trump’s team is not backing (…) It is clear that Washington is using market difficulties as a lever to negotiate, and not as a sign that encourages them to change course,” said Stephen Innes, of Spi Asset Management.
For his part, the general director of Banco JPMorgan Chase, Jamie Dimon, warned in a letter to his shareholders that tariffs “will probably increase inflation” in the United States.
In Asian markets all values were affected, from technological to cars, through banks, casinos or energy companies.
Among the biggest losers There are the big Chinese technological companies like Alibaba, which lost more than 17%, and their rival JD.com (14%),
In parallel, the concern for demand dropped oil to levels that were not seen from the Covid-19 pandemic.
Copper, a vital component for energy storage, electric vehicles, solar panels and wind turbines, also expanded its losses.
A “historical” fall
Economists still do not speak of “Crac”, a word that designates an abrupt and generalized fall of prices with important consequences on the real economy.
But analysts already talk about a “historical” fall and even A “blood bath” in Asian and European markets.
The bags lived a black Thursday on March 12, 2020, the day after the World Health Organization (WHO) declared the Covid-19 Pandemia.
That day, Paris lost 12%, Madrid 14%and Milan 17%. London and New York respectively lost 11% and 10%, something unpublished since the CRAC of October 1987.
Oil with downward trend
The Brent crude barrel fell on Monday, April 7, 2.25 % in the London market and, in just three sessions, accumulates a setback of almost 15 %, with what It is at its minimum level of the last four years, due to the impact of tariffs Taxes by the president of the United States, Donald Trump, to the rest of the world.
The Crude of the North Sea, reference in Europe, was quoted at US $ 64.10, a decrease of 2.25 % compared to the closure of Friday’s session, and remains well below the US $ 70 barrier.
Black gold continued its downward trend after collapse in Asian markets, the most affected by additional tariffs imposed by Trump last week.
The tariff policy will again dominate the course of stock markets this week, after the previous threats of taxes by the president of the USA., Donald Trump, have begun to be launched.