© Reuters. THE EUROPEAN STOCK MARKETS FINISH IN THE RED
by Patrick Vignal
PARIS (Reuters) – The european markets ended Friday in the red in an atmosphere darkened by the statements of Donald Trump on the barriers at the border and his criticism of the monetary tightening implemented by the federal Reserve.
In Paris, the CAC 40 lost 0.35% to 5.398,32 points. The Footsie british ceded 0.07% and the German Dax dropped 0,98%.
The index EuroStoxx 50 has dropped to 0.33%, the FTSEurofirst 300 0,11% and the Stoxx 600 is 0.15%.
Throughout the week, the CAC 40, which was two progressions consecutive weekly, was down 0.57%.
The european indices have widened their losses after the threat made by Donald Trump to impose tariffs on $ 500 billion of goods imported from China.
The american president, who had already evoked such an amount, mentioned again in an interview with CNBC, putting an end to a fragile truce in the trade dispute between the two leading economies of the world.
In Europe, the sectors sensitive to trade tensions have suffered, starting with the automobile, in which the index has lost 2,08%.
Investors are now awaiting the meeting scheduled for next Wednesday in Washington between the president of the european Commission and Donald Trump to discuss trade relations.
Jean-Claude Juncker should try to persuade the us president to waive its threat of taxation on imports of european cars. But the task could be difficult, especially as Donald Trump has made no secret Thursday of his discontent at the announcement of a fine of 4.34 billion euros imposed by the Commission to Google (NASDAQ:GOOGLE).
THE DOLLAR DROPS, EURO RISES
In Exchange, Volkswagen (DE:VOWG_p) (-2,26%), BMWG (-1,82%), Daimler (DE:DAIGn) (–2.35 per cent), Renault (PA:RENA) (-1,19%) and PSA (PA:PEUP) (-2,41%) are among the biggest declines of the day.
The values that are export oriented have been penalized in addition by the appreciation of the euro, which has ironed out 1.17 to the dollar (+0,56%).
The single currency has climbed in parallel with the drop in the greenback after a tweet from Donald Trump criticizing the policy of monetary tightening by the federal Reserve.
The dollar has immediately widened its losses to fall to a low of more than a week opposite a basket of currencies of reference.
The statements of Donald Trump in contrast, have little effect on the yields of government bonds with americans and do not change the sentiment of market participants, who expect still to be two more rate hikes this year, which is four in total in 2018, according to the barometer FedWatch CME Group.
James Bullard, president of the Fed of St. Louis, said he was not surprised by the remarks of the american president and is expected to renew his criticism, but that he does not think that they would influence the central bank.
At the time of closing in Europe, the Dow Jones and the S&P 500 returned timidly to the increase. The Nasdaq rises more openly, thanks in particular to the support of Microsoft (NASDAQ:MSFT), which takes up to 2.50% after results well received.
(Edited by Juliette Rouillon)