Europe midday: Shares slide on trade fears, geopolitical tensions
By Frank Prenesti
Date: Thursday 12 Jun 2025
(Sharecast News) - European shares extended sharp losses at midday on Thursday as the US trade war with the rest of the world rumbled on, Iran-US tensions increased, and UK GDP contracted sharply.
The pan-regional Stoxx 600 index was down 0.80 at 547 points with major bourses lower. Germany's DAX fell 1.11% and Britain's FTSE 100 off by 0.12%.
Investors are worried that trade deals won't be delivered before US President Donald Trump's July 8 deadline, while major areas of disagreement between Washington and China still remain despite an upbeat conclusion to trade talks between the two nations this week.
Meanwhile US personnel were being moved out of the Middle East because "it could be a dangerous place" amid rising tensions with Iran, Trump said on Wednesday. The news hit travel stocks, with TUI, Lufthansa, IAG, Accor, easyJet and Carnival all lower.
Official figures showed the British economy contracted 0.3% in April as exports to the declined by the most on record.
Exports to the US fell £2bn in April - the biggest monthly drop since records began in 1997, with the decline "likely linked to the implementation of tariffs on goods imported to the United States", the Office for National Statistics said.
There is still confusion as to whether Trump will extend the tariff pause beyond July 8. Treasury Secretary Scott Bessent indicated they would, but the president said this week that countries would start to receive letters outlining unilateral levies.
"There's more of a downbeat mood in play as tariffs are once again the talk of the town and countries brace for punishment if they don't play ball with the US," said Matt Britzman, senior equity analyst at Hargreaves Lansdown.
"The Trump/Bessent good cop-bad cop routine is in full swing. Trump is saying nations can 'take it or leave it' when it comes to tariff deals on offer. But Treasury Secretary Scott Bessent is offering a carrot in the form of potential extensions to the 90-day pause on reciprocal tariffs for those willing to negotiate."
"Markets have reacted badly nonetheless, and there's a sea of red across Europe this morning."
Reporting by Frank Prenesti for Sharecast.com
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