Investing.com — European stock markets fell Friday, as investors fretted about the potential of a trade war with the US, while digesting more important economic data.
At 06:50 ET (11:50 GMT), Germany’s DAX fell 1.5%, France’s CAC 40 dropped 1.1%, and the UK’s FTSE 100 slipped 0.9%.
Trump issues tariff threat against EU
US President-elect Donald Trump reignited tensions with the European Union on Friday by threatening to impose tariffs if the EU didn’t make some attempts to address its substantial trade deficit with the US by buying American oil and gas.
The statement was made on his Truth Social platform, adding to concerns about US-EU trade relations.
The eurozone economy is currently struggling for growth, with the German economy, the region’s largest, particularly hard hit. A trade war at this point would be economically taxing.
Data released earlier Friday showed that German producer prices rose unexpectedly in November, increasing by 0.1% on the year, after having been expected to fall by 0.3%.
British retail sales rose by a weaker-than-expected 0.2% in November, instead of the 0.5% growth expected, adding to signs of slow momentum in the economy.
US faces imminent government shutdown
Political uncertainty on the US also weighed on sentiment, with the country braced for a partial government shutdown set to begin Friday night after a Trump-endorsed spending bill failed to gain sufficient support.
A group of Republican lawmakers opposed the proposal, which sought to extend government funding for three months and suspend the debt ceiling for two years. The legislative impasse has injected fresh uncertainty into the political landscape.
ITM Power secures green hydrogen project
In the corporate sector, ITM Power (LON:ITM) stock rose 1% after the hydrogen economy company secured a contract for a green hydrogen project in the EU.
Elsewhere, Synairgen (LON:SYNG) stock slumped 40% after it launched a fundraising campaign to secure up to £19 million for phase 2 trials of its antiviral treatment.
Idorsia (SIX:IDIA) stock fell 45%, and was on track for its deepest one-day decline on record, after the Swiss biopharma company said exclusive talks for global rights to hypertension medication Tryvio had stalled.
Zealand Pharma (CSE:ZELA) stock dropped 20% after the US FDA declined to approve the Danish biotech group’s bowel disease drug.
Oil prices down amid Fed signals and demand concerns
Crude oil prices fell on Friday, as the Federal Reserve hinted at a slower pace of rate cuts next year, boosting the dollar to a two-year high.
At 06:50 ET, Brent crude futures for February delivery fell 1.1% to $72.08 per barrel, while West Texas Intermediate crude futures also dropped 2.9% to $68.55 per barrel.
Persistent worries over weakening demand, limited details on Chinese stimulus measures, and signs of reduced U.S. fuel consumption further pressured prices.
Additionally, concerns over the impending U.S. government shutdown added to market anxiety, with expectations of disrupted travel and economic activity.
(Navamya Acharya contributed to this article.)