Europe open: Stoxx down on trade war tensions, Poland election result
By Frank Prenesti
Date: Monday 02 Jun 2025
(Sharecast News) - European shares were lower at the open on Monday as trade war tensions increased between China and the US while Polish shares were hit by the election of right-wing populist Karol Nawrocki as president.
The pan-regional Stoxx 600 was down 0.23%, with Germany's DAX 0.27% lower. Poland's WIG index fell 1.3% on fears that Nawrocki would hinder the pro-Europe government of Donald Tusk.
Britain's energy-heavy FTSE 100 bucked the trend with a small gain as oil prices rose.
Asian shares were sharply lower as Beijing accused the US of "seriously violating" the trade truce which the two powers agreed in Zurich last month after US President Donald Trump made the claim in reverse over the weekend without any supporting evidence.
China's commerce ministry said it would take forceful measures to safeguard its interests and rejected Trump's claim.
"The U.S. government has unilaterally and repeatedly provoked new economic and trade frictions, exacerbating uncertainty and instability in bilateral economic and trade relations," the ministry said in a statement.
Beijing accused Washington of unilaterally introducing new discriminatory restrictions, including new guidelines on AI chip export controls, curbs on chip design software sales to China and the revocation of Chinese student visas.
"The tit-for-tat narrative has sharpened, and with both sides digging in, the political tone is growing more adversarial by the hour. This isn't just diplomatic shadowboxing anymore-it's bleeding into market sentiment," said SPI Asset Management partner Stephen Innes.
"In the absence of clarity, risk aversion remains the default trade in Asia. Equities are sliding, and capital is shifting to more defensive postures. Markets aren't pricing in a clean resolution anytime soon-and that's a message worth heeding.
In equity news, Polish banks were down on the election of right-wing populist opposition candidate Karol Nawrocki as president, defeating the pro-European Rafał Trzaskowski. Bank Polska Kasa Opieki, Powszechna Kasa Oszczednosci Bank, and Santander Polska all fell between 3.5 and 5%.
Reporting by Frank Prenesti for Sharecast.com
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