Trade Turmoil: European Shares Tumble Amid US Policy Shifts

European shares declined sharply due to the week's erratic U.S. trade policies, focusing on U.S. jobs data. President Trump's fluctuating tariffs affected market confidence, impacting stocks like Richemont and Burberry. The STOXX 600 saw a dip, influenced by ongoing uncertainties in global trade conflicts and monetary policies.

European shares experienced significant declines on Friday as the week's erratic U.S. trade policies resulted in heightened risk aversion, with attention focused on the critical U.S. jobs data yet to be released.

The pan-European STOXX 600 fell 0.6% by 0924 GMT, poised to end its remarkable 10-week winning streak. On Thursday, U.S. President Donald Trump suspended the recently imposed 25% tariffs on most imports from Canada and Mexico, marking another volatile shift in trade policies that have unsettled markets. Earlier, Trump had both implemented and then lifted these tariffs, creating ongoing investor uncertainty.

The changes wreaked havoc on luxury stocks; Richemont, Burberry, and Kering all saw losses, while automakers sensitive to trade tensions dropped by 1.5%. Despite a boost from the European Central Bank's interest rate cut, the STOXX 600 faced downward pressures due to broader market uncertainties. Investors remained cautious as Germany's fiscal policy revamp and U.S. economic indicators, including the forthcoming Federal Reserve update, continued to weigh on sentiment.

(With inputs from agencies.)