European actions fell on Friday, with the Stoxx 600 reference index and German DAX confirming correction territory, after China’s retaliation for US tariffs intensified fears of a global recession triggered by the trade war.
China has announced a series of countermeasures against US President Donald Trump’s fees, including additional 34% tariffs on all US products and restrictions on exporting some rare lands. The movement was after the US adopted reciprocal rates on business partners on Wednesday.
The Pan-European Stoxx index closed down 5.1%, its greatest daily loss from the covid-19-driven settlement in 2020. The index fell almost 12% over its historic closing record on March 3, confirming that it is in correction territory.
The weekly rate of the rate of over 8% was also the worst in five years, as investors avoided the risk and sought safe assets. Income from Eurozone public securities have fallen sharply.
The German DAX index and the Euro zone blue-chips index also confirmed the correction, falling 5% and 4.6%, respectively.
An indicator of the Volatility of the Eurozone stock market rose 8.68 points to 34.2, the largest increase in one day in more than two years.
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“There were only a few occasions when risk aversion was worse than it is today,” said Benjamin Ford, a macro Hive strategist. “One was during the great financial crisis and the other was during COVID-19.”
Tariffs among the world’s largest economies mark a sharp climbing in the global trade war that threatens to increase prices, overthrow supply chains, and reduce companies’ profit margins.
In London, the Financial Times rate retreated 4.95%to 8,054.98 points.
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In Frankfurt, the DAX index fell 4.95%to 20,641.72 points.
In Paris, the CAC-40 index lost 4.26%to 7,274.95 points.
In Milan, the FTSE/MIB index had a devaluation of 6.53%to 34,649.22 points.
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In Madrid, the IBEX-35 index recorded a low of 5.83%, to 12,422.00 points.
In Lisbon, the PSI20 index devalued 4.75%to 6,635.79 points.