European Markets Mixed as Regional Automakers Eye Trump’s Tariff Plans By Investing.com

Investing.com – European stock markets hovered either side of a flat line on Tuesday, as investors weighed expectations for US President Donald Trump’s tariff plans after his inauguration.

The European index was mostly unchanged at 04:25 EST (09:25 GMT), while the UK index rose 0.1%.

In France, the rate was also broadly flat. But it fell 0.2%, weighed down by pressure from automakers in Europe’s largest economy, which are seen as exposed to Trump’s trade stance.

While he unveiled a set of executive orders in the first hours of his second term in the White House, Trump stopped short of imposing global tariffs on America’s allies and adversaries alike, arguing that he is not yet ready for such a step.

Instead, he instructed federal agencies to consider persistent U.S. trade deficits and perceived unfairness in trade practices by other countries.

In a memorandum, Trump ordered the Departments of Commerce and Treasury and the US Trade Representative to investigate the “economic and national security impacts and risks” of the trade deficit and recommend “appropriate” responses, such as imposing a global supplementary tariff or imposing global supplementary tariffs. Other policies” to address the matter.

However, initial relief among traders that the orders did not include first-day tariffs was dampened when Trump told reporters he was considering imposing 25% tariffs on Canada and Mexico starting February 1. This move may affect European car manufacturers, which have factories. In Mexico, which produces cars for the United States.

A spokesperson for German auto giant Volkswagen (ETR:) said the company is concerned about the potential harm that Trump’s sweeping import tariffs could do to consumers and the broader auto industry, Reuters reported.

Volkswagen shares fell, as did local peers BMW (ETR:) and Mercedes (ETR:), in morning trading, and shares of Milan-listed Jeep owner Stellantis (BIT:) (NYSE:) fell. The large-scale automotive sector also declined by 0.7%.

Concerns over tariffs also hit Spanish bank BBVA (BME:). Shares of the company, whose largest market is Mexico, fell in Madrid, reflecting the weakness of the Mexican peso against the US dollar.

In individual stocks, Abrdn shares rose more than 6% after the investment firm reported better-than-expected net flows in the fourth quarter, signaling a potential turnaround in its overall performance.

Meanwhile, Ørsted shares fell more than 16% on Tuesday after the wind farm developer announced a DKK 12.1 billion impairment charge due to challenges at offshore wind projects in the United States.

Oil prices fell in European trade on Tuesday after President Trump declared a national emergency on his first day in office aimed at supporting US energy production.

Trump said at a White House press conference that he would declare a national energy emergency and use “all necessary resources” to build America’s energy infrastructure.

West Texas Intermediate crude futures expiring in March fell 0.5% to $79.79 a barrel, while West Texas Intermediate crude futures fell 1.3% to $76.39 a barrel by 03:37 ET.