Paris (awp/afp) – European stock markets sank on Tuesday, with Donald Trump’s victory for the American presidency posing the threat of a surcharge ranging from 10 to 20% on all foreign products entering the United States, one of the main trading partners of the Old Continent.
European stock indices accentuated their losses at the end of the session and the Paris Stock Exchange fell by 2.69% at the close, Frankfurt by 2.13%, Milan by 2.15% and London dropped 1.22%. In Zurich, the SMI fell 1.60%.
The Americans “chose to bring back to the White House a man who declared, only a few weeks ago, that the European Union would have to ‘pay a high price’ if he won”, underlines Isabelle Mateos y Lago, economist at BNP Paribas.
“These variations are much more logical than the gains” that the European indices were able to record after the election of Trump last week “given the questions around the economic consequences for Europe”, comments Andrea Tuéni, market analyst at Saxo Bank France.
Donald Trump warned that customs duties remained the cornerstone of his trade policy, citing the imposition of a surcharge ranging from 10 to 20% on all foreign products entering the United States and promised to go up to 60% for those coming from China.
In this context, “the election of Donald Trump could well prove to be the shock that will save Europe from procrastination on the measures to take to preserve its place in the world”, notes Isabelle Mateos y Lago.
On Wall Street, the indices are taking a break after having accumulated records in recent days. Around 4:55 p.m. GMT, the Dow Jones dropped 0.49%, the S&P 500 0.25% and the Nasdaq 0.10%.
The euro falls against the dollar ___
Bitcoin, the largest cryptocurrency in terms of capitalization, took full advantage of Trump’s return to power and rose to $89,968.
Around 4:50 p.m. GMT, it fell by 0.71% to $87,391. For comparison, it was trading below $70,000 before the November 5 presidential election.
Under a Trump presidency, with a Senate dominated by the Republican Party – also on course to win the House of Representatives – the United States could adopt bitcoin as a strategic reserve asset.
“There is no reason” to see the rise of bitcoin stop and the threshold of “100,000 dollars seems easily achievable”, estimates Andrea Tuéni.
On the foreign exchange side, the dollar continues to gain ground, benefiting from expectations of a more restrictive monetary policy from the American central bank (Fed), due to the inflationary risks of the future American president’s program.
Around 2:50 p.m. GMT, the greenback gained 0.53% to 1.0599 dollars per euro, which was at its lowest level in a year against the American currency.
The interest rate on the benchmark ten-year American bond jumped to 4.41%, compared to 4.30% at the last close on Friday. The day before, the US bond market was closed due to a public holiday.
Geopolitical risk benefits oil ___
Oil prices are rising with the return of the risk of conflict between Iran and Israel.
Israel’s new defense minister ruled Monday that Iran was “more exposed than ever to strikes on its nuclear facilities.”
Around 4:50 p.m. GMT, the price of a barrel of Brent from the North Sea rose 0.31% to $72.05. Its American equivalent, a barrel of West Texas Intermediate (WTI) gained 0.32%, to $68.26.
Bayer, notable fall of the session ___
German agrochemical and pharmaceutical giant Bayer fell more than 15% in Frankfurt, posting one of the worst performances of the European session, after the group announced that it remained in the red in the third quarter with a net loss. of 4.18 billion euros.
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