Citi downgrades European equities to neutral after Trump's tariff threats

SINGAPORE, Jan 20 (Reuters) - Citi downgraded continental Europe on Tuesday to "neutral" for the first time in over a year, saying the latest step-up in transatlantic tensions and tariff uncertainty dented the near-term investment case for European equities.

U.S. President Donald Trump over the weekend threatened additional tariffs on eight European countries until the U.S. is allowed to buy Greenland, ushering in fresh trade uncertainties.

"We downgrade Europe to Neutral in our global allocation," Citi strategists said, noting their targets still point to an upside for the pan-European STOXX 600 .STOXX by the end of 2026, but they see more attractive risk-reward elsewhere.