Euronews is no longer accessible on Internet Explorer. This browser is not updated by Microsoft and does not support the last technical evolutions. We encourage you to use another browser, such as Edge, Safari, Google Chrome or Mozilla Firefox.

BREAKING NEWS

BREAKING NEWS

VW, Fiat hit as European shares slump on Trump's Mexico tariffs

VW, Fiat hit as European shares slump on Trump's Mexico tariffs
FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, May 29, 2019. REUTERS/Staff -
Copyright
STAFF(Reuters)
Text size Aa Aa

(Reuters) – European shares sank to a more than three-month low on Friday, led by carmakers Volkswagen and Fiat Chrysler after President Donald Trump opened a new front in global trade tensions by promising tariffs on Mexican imports.

Trump said all Mexican goods would face a 5% tariff from June 10 until illegal immigration is stopped, threatening to disrupt supply chains at a time when investors are again worrying about the threat of recession.

A worse than expected batch of Chinese data added to the dour mood, sending the pan-European STOXX 600 0.9% lower by 0708 GMT.

All European sectors were in the red, as investors dumped stocks in favour of the safety of government bonds and Germany’s DAX, which is particularly vulnerable to trade risks, dropped 1.3% to a two month low.

The European auto index fell 2.7%, driven by 3% falls in both Volkswagen and Fiat Chrysler, who have significant exposure to Mexico.

Spanish banks Santander, Sabadell and Bilbao, which all have a sizable presence in Mexico, slid between 3.6% and 1.8%.

(Reporting by Medha Singh in Bengaluru)

euronews provides breaking news articles from reuters as a service to its readers, but does not edit the articles it publishes. Articles appear on euronews.com for a limited time.