April’s equities rally risked running out of puff on Tuesday, as a U.S. threat to slap tariffs on hundreds of European goods and expectations of another chunky chop to the IMF’s global growth forecasts tested investors’ stamina.
Asia had eked out a 8-month high overnight but Europe was left flat after the office of the U.S. Trade Representative sent its proposals to the World Trade Organisation, saying the EU had provided $11 billion worth subsidies to Airbus.
The planemaker’ shares dropped as much as 2.5 percent in early deals. Many of its key suppliers lost between 0.7 percent and 1.2 percent, though it could have been worse and most of Europe’s big bourses clawed back to level.
Aberdeen Standard Investment’s head of global multi-asset strategy, Andrew Milligan, said: “Signals like this just remind people… that the strategic rivalry between the U.S. and other countries is serious and is not going to go away.”
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