Severely stung by Trump restoring tariffs on Brazil and Argentina on Monday, the markets coped surprisingly well with the President’s overnight threat to France.
The Trump administration has proposed new tariffs on $2.4 billion of French goods, including typically Gallic fare like cheese and champagne, in retaliation to the country’s new digital services tax, one that quite rightly would hit the wallets of American tech monoliths Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOG) and Facebook (NASDAQ:FB).
Instead of suffering another round of serious losses, the Eurozone markets broadly rebounded. And, to be fair, they have plenty of ground to recover – Monday was a nasty, nasty start to December. The DAX jumped 80 points as it pushed back past 13000, with the FTSE MIB rising 1% and the IBEX 35 up 0.5%. The notable, obvious exception was the CAC, which could only eke out a 0.1% increase; not bad, however, given the situation between the US and France.
The French bourse wasn’t even Tuesday’s worst performing major index. The FTSE sank another 0.4% after the bell, falling to a one and a half week low as it was hurt by the troubled state of its commodity stocks and a bounce from sterling.
The pound added 0.2% against dollar and euro alike, leaving it at a near 7-month peak against the former and back above €1.171 against the latter. This despite the Tories’ ever-shrinking lead in the polls and the prospect of a terrible, if improved, construction PMI.
Disclaimer: Spreadex provides an execution only service and the comments above do not constitute (or should not be construed as constituting) investment advice or recommendations, or a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any person placing trades based on their interpretations of the above comments does so entirely at their own risk. Spreadex Ltd is a financial and sports spread betting and sports fixed odds betting firm, which specialises in the personal service and credit area. Founded in 1999, Spreadex is recognised as one of the longest established spread betting firms in the industry with a strong reputation for its high level of customer service and account management.
In relation to spread betting, Spreadex Ltd is authorised and regulated by the Financial Conduct Authority. Spread betting carries a high level of risk to your capital and can result in losses larger than your initial stake/deposit. It may not be suitable for everyone, so please ensure you fully understand the risks involved.