Stock exchanges, EU growth fears dampen enthusiasm. Milan flat, Euro falling

(Il Sole 24 Ore Radiocor) - After the enthusiastic start of the signing of the 15% tariffs agreement between Europe and the United States, the European stock markets are trading in a chiaroscuro mood as investors begin to reckon on what the economic consequences of the agreement will be. While it is true that the 15% landing point has avoided the escalation of a trade war, the market fears thatthe deal could dent growth in the Old Continent.

As Pimco's economists point out, "we believe this will weaken Eurozone growth by almost a percentage point relative to the counterfactual scenario, likely bringinggrowth almost to a standstill over the next two quarters. However, the impact of trade policy uncertainty on business behaviour is difficult to estimate and we will continue to monitor the data closely to assess the magnitude of the impending slowdown and the likely policy response."

Thus Frankfurt put in the worst performance (DAX 40), followed by Paris (CAC 40 ) while Milan (FTSE MIB) closed just above par (+0.01%) while registering a positive balance of +6% since Liberation Day on 2 April, when Trump made the announcement on reciprocal tariffs. According to Carmignac 2 analysts, "at first glance the trade agreement between the US and the European Union offers very little to celebrate for Europe. European exports to the US will now be subject to a 15% customs tax - ten times higher than the pre-trade war level of around 1.5%. However, what appears to be a capitulation of the EU deserves a deeper analysis on three key dimensions'. On the same wavelength are the Unicredit experts, who point out that "an asymmetric agreement between the EU and the US is better than no agreement at all. However, it is probably not a good deal for the EU, since it leaves US tariffs at much higher levels than the EU on US goods. The deal is probably good enough for the European economy and markets insofar as it takes an escalation of trade tensions off the table.

The sector that suffered the most was the auto sector, which followed the same trend as the stock markets. After a sparkling start, a number of doubts appeared on the horizon with Acea, in particular, pointing out that 'the US will maintain higher tariffs on cars and car components, and this will continue to have a negative impact not only on the EU industry, but also on the US industry'. Thus, on the Ftse Mib Stellantis slides to the bottom of the list, preceded by Iveco Group. Paris-listed shares also suffered in Renault. In Frankfurt sales on Mercedes-Benz Group, Volkswagen and Porsche Automobil Holding Pref. German automakers are among the most exposed in the US market.

Wall Street up slightly after US President Donald Trump announced that the US had reached an agreement with the European Union on 15% tariffs. Wall Street is preparing for a particularly busy week, which will bring results from several major technology companies, a key Federal Reserve meeting, Trump's 1 August tariffs deadline, and important inflation data. In addition, more than 150 companies in the S&P 500 Index will release their quarterly results, including Meta Platforms and Microsoft Corp , on Wednesday, followed by Amazon and Apple on Thursday. The indices are coming off a positive week, fuelled by solid earnings and trade deals between the US and some partners, including Japan and Indonesia.