Europe close: Stocks mixed as US tariffs hit risk appetite
By Benjamin Chiou
Date: Monday 14 Jul 2025
(Sharecast News) - European stocks finished mixed on Monday as investors weighed the news of 30% tariffs on EU imports into the United States, dampening hopes of a trade deal between the two regions.
The figure was far more than what many markets had expected, following the 10% tariff secured by the UK in a trade deal announced last month.
"Europe enjoyed a monster start to 2025 thanks to investors looking for cheaper valuations compared to the US and the prospect of greater spending by the German government on areas such as defence and construction. High tariffs threaten to spoil this party and could lead to a bout of profit taking by investors," said AJ Bell investment analyst Dan Coatsworth.
The pan-European Stoxx 600 index finished 0.1% lower as solid gains in London were countered by falls in Paris and Frankfurt, as well as subdued performances in Milan and Madrid.
"Imposing 30% tariffs on EU exports would disrupt essential transatlantic supply chains, to the detriment of businesses, consumers and patients on both sides of the Atlantic," said European Commission President Ursula von der Leyen.
She said the 27-nation bloc was still "ready to continue working towards an agreement by August 1", but added: "At the same time, we will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required."
With the UK already negotiating a trade deal with the US last month, London's FTSE 100 pushed 0.6% higher on Monday.
In a broker note analysing the impact of the EU tariffs, Panmure Gordon said the UK could be a "trade war winner", resulting in an outperformance by London-listed stocks compared with their continental peers.
"Because the UK is subject to 10% tariffs and tariffs for exports from the EU to the UK are typically 10%, EU manufacturers could ship goods from the EU to the UK, slightly alter them in the UK to turn them into 'Made in the UK' goods, and then ship them to the US," the broker said.
Market movers
Lifco shares plunged 9% as the Swedish conglomerate posted a 4% fall in second-quarter earnings on the back of weaker organic growth and falling margins.
Zalando was another heavy faller after Morgan Stanley slashed its target price for the Berlin-based ecommerce giant on the back of heightened competition from TikTok Shop's expansion, which launched in Germany and France in the spring.
Associated British Goods was the top riser in London after Panmure Liberum upgraded shares of the Primark owner to 'buy' from 'hold', while BA and Iberia parent IAG flew higher as JP Morgan flagged the stock as one of its top picks across Europe's airlines.
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