European stocks have made better than American stocks under the Trump administration. The main Stoxx EUROPE 600 index increased by 5.6 %, while in Wall Street, the S&P 500 increased by 2.5 %, and the NASDAQ technology compound increased by 2.2 %.
according to AnalystsThis wonderful performance is the result of Trump’s decision not to put definitions on the European Union immediately. In addition, there are hopes for peace talks in Ukraine.
According to Bank of America, European stocks have started the best start for a year since the late eighties. They are also doing their best compared to the United States within almost ten years.
This was unexpected because Trump’s election was the latest event that caused European stocks to store behind American stocks with the largest spread. In fact, investors were afraid of a brutal trade war. In recent years, Wall Street has helped with a significant rise in large technology shares.
Trump threatened the European Union countries with definitions due to their injustice to the United States. Therefore, the group was expected to be a great target for “America first” policies. However, the definitions have not yet been placed. To this end, Europe pledged revenge if Trump imposed definitions on the bloc.
Some experts are not sure whether Europe’s performance will continue throughout the year. This may be the case, especially if the American definitions are delayed only instead of lowering them.
UBS analysts said: “The muscle memory of most investors is that European performance can only be with small amounts for very short periods.”
What role does Europe play in this increase?
Since the beginning of the year, European fund managers have increased their allocations, which helped gather. This week, an opinion poll showed that the percentage of people who believed that the shares of the region was less than its value was at the highest level in six years.
The lack of a tariff today in stocks in sectors such as financing, defense and luxury goods. This is reinforced in the hope that European countries will spend more
Rheinmetall, which makes the most ammunition in Europe, increased by 34 % last month, while Richmont, which makes high -end goods, increased by 11 %.
The dollar lost 1.6 % of its value against the euro last month.
UBS analysts have raised their customization to Europe the main righteousness to gain weight. They did so because they saw low energy prices as a benefit in ending Russia’s invasion of Ukraine, improvised financial policy, and the profits of the highest companies.
Hong Kong takes the initiative. He had the best performance, the Hang Seng, which has risen 15 % since January 20. This introduction was affected by an increase in the shares of Chinese technology traded in Hong Kong after Deepseek.
Trump’s tariff causes more harm than. American markets have been greatly shattered since Trump entered power. However, the Trump bank administration is still a better future.
Trade between the European Union and the United States – What is the effect of a tariff?
In 2024, the United States bought goods from European Union member states worth about $ 600 billion. According to data from pharmaceutical commodities in the American Trade Census, the most important thing the United States bought from the European Union in 2024.
President Trump is studying definitions on many different types of goods of partners, not just minerals. This will be the latest “mutual” commercial movement by the United States government, and some types of goods will be more difficult than others.
To this end, drugs and medicine as a whole will be one of the most affected sectors of definitions. The value of the imports of surgical and medical tools amounted to 37 billion dollars, and medical devices, such as CRT machines, respirators, bone devices and surgical equipment, were 22 billion dollars.
Another product in 2024 was hearing hearing tools, which brought $ 1.3 billion, and artificial joints, which brought 2.5 billion dollars.
In addition, the White House said that the commercial and tax rules between the United States and the European Union were unfair to oysters and cars. Trump said, “They do not take our cars, do not take our agricultural products, do not take anything almost, and we take everything from them. Millions of cars, huge amounts of food and agricultural products.” In fact, 20 European Union member states were exported to the United States more than it was imported in 2023.
Trump Jameson Jarir chose to be the American Trade Representative. Jarir is a real economic nationalist who believes the customs tariff is the only way to reproduce to the United States.
It is especially interested in the non -trade balance between the United States and Europe in agriculture and cars. Jarir will try to reform this by pressing the European Union to reduce the customs tariff and get rid of other barriers that are not duties.
What can the European Union do? Jarir expects the European Union to agree with the United States on China when it comes to controls on technology and exports, examining the upcoming investment and exit, and ensuring that the supply chain is strong. Europe can make him change his opinion on the definitions of European Union exports by showing that he is ready to work with them in some of these issues.
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