LIVE MARKETS-Before the bell: Europe heads south on US tariff threat

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BEFORE THE BELL: EUROPE HEADS SOUTH ON US TARIFF THREAT

European shares were set for a weak start on Monday after U.S. President Donald Trump announced a 30% tariff on most imports from the EU next month, although losses might be limited by hopes that negotiations could result in a deal.

EuroSTOXX50, DAX and FTSE futures fell between 0.2 and 0.8%, while contracts on the S&P 500 also declined by 0.5%.

The threatened tariff is higher than what was expected before Saturday's announcement, but many investors still called for talks to reduce the rate to a more manageable level for European exporters.

ING economists said it was too early to panic.

"We still expect some kind of deal before August 1 that will result in a universal tariff of 10% and sectoral tariffs of between 20% and 25% for the EU," they wrote in a note.

But they added: "Is this a conviction call? No."

Possibly reflecting this uncertainty, tariff-exposed automakers were among the biggest fallers in early Frankfurt trading. Shares in Volkswagen VOWG.DE, BMW BMWG.DE, and Mercedes-Benz MBGn.DE all fell around 2% on Tradegate.

Meanwhile, weaker global growth and the impact of U.S. tariffs on demand led chemicals group BASF BASFn.DE to cut its 2025 profit outlook.

(Danilo Masoni)

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