European stocks to start the week lower as markets react to new Trump tariffs

• U.K. stocks expected to open 0.2% lower, with Germany down 0.7%, France down 0.4%, and Italy down 0.45%
• Trump raised the worldwide tariff from 10% to 15% effective immediately via Truth Social, warning that additional levies would follow
• Market uncertainty has increased over the outlook for inflation and global growth following the new blanket tariff policy

Market Summary: European Stocks Pressured by Escalating Trump Tariffs

Key Developments:

European equity markets are poised to open lower Monday as investors digest President Donald Trump's announcement of increased global tariffs. The blanket tariff rate will rise to 15% from 10%, effective immediately, according to Trump's weekend social media post.

Market Impact:

• U.K. FTSE 100: Expected to open down 0.2%
• Germany DAX: Projected to fall 0.7%
• France CAC 40: Anticipated decline of 0.4%
• Italy FTSE MIB: Forecast down 0.45%

Background:

The tariff escalation follows last week's U.S. Supreme Court ruling that struck down a significant portion of Trump's "reciprocal" tariffs, which had initially boosted European markets. However, the president responded by raising the worldwide tariff rate and warning that additional levies would follow.

Trump justified the increase by claiming many countries have been exploiting the U.S. for decades "without retribution."

Broader Market Reaction:

Global markets showed heightened uncertainty overnight, with futures falling Sunday evening. The tariff announcement raises concerns about inflation pressures and global economic growth prospects, though specific details on futures and other asset classes were limited in the report.

Upcoming Catalysts:

Monday's trading session features a light economic calendar with no major earnings releases scheduled. Key data releases include Germany's Ifo business climate survey and Italy's latest inflation figures.

The escalating trade tensions create uncertainty for European exporters and multinational corporations with U.S. exposure, potentially dampening growth expectations across the continent.