European Stocks Close Notably Lower On Trade War Jitters

European stocks tumbled on Tuesday as U.S. President Donald Trump’s tariff threats and efforts to take control of Greenland raised trade war threats.

The United States depoloyed military aircraft to Pituffik Space Base in Greenland, prompting Denmark to rush its Army chief and troops to the Arctic Island in a dramatic escalation of tensions.

On the tariff front, U.S. President Donald Trump threatened to impose 200% tariffs on French wine and Champagne after Paris rejected his invitation to join the proposed Board of Peace initiative aimed at resolving global conflicts. The French government said that it “does not intend to answer favorably.”

The pan European Stoxx 600 slipped 0.7%. The U.K.’s FTSE 100 ended down by 0.67%, Germany’s DAX closed 1.03% down, and France’s CAC 40 lost 0.61%. Switzerland’s SMI fell 0.81%.

Among other markets in Europe, Belgium, Czech Republic, Finland, Greece, Iceland, Ireland, Portugal, Russia, Spain and Sweden ended with sharp to moderate losses. Netherlands edged down marginally.

Denmark, Norway and Turkiye closed higher, while Poland ended flat.

In the UK market, Mondi tumbled 4.65%. Beazley closed down by 3.7%, while Pershing Square Holdings, Land Securities Group, Bunzl, St. James’s Place, British American Tobacco, Prudential, Ashtead Group, Imperial Brands and Entain lost 2 to 3%.

AstraZeneca drifted down by about 2.7% after the drug maker announced it would delist its American Depositary Shares and debt securities from Nasdaq.

Informa climbed more than 4.5%. Haleon and Endeavour Mining moved up 3.27% and 2.73%, respectively. Rentokil Initial, Melrose Industries, Coca-Cola Europacific Partners and Rolls-Royce Holdings also closed notably higher.

In the German market, Fresenius fell nearly 5%. Vonovia, Fresenius Medical Care, Bayer, Zalando, Deutsche Telekom, Merck, Henkel, Heidelberg Materials, E.ON, Continental, Allianz, Symrise, Brenntag and RW lost 1 to 3.5%.

Qiagen and Deutsche Boerse both gained more than 2%. MTU Aero Engines, Adidas, Beiersdorf and BMW posted moderate gains.

In the French market, Capgemini, Edenred, Eurofins Scientific, LVMH, Stellantis, Veolia Environment, Kering, Saint Gobain, Vinci, Airbus, Carrefour and Sanofi lost 1 to 3%.

Renault, TotalEnergies, STMicroElectronics, TP, L’Oreal, Pernod Ricard, Dassault Systemes and Essilor posted sharp to moderate gains.

In economic news, data from Destatis showed Germany’s producer prices decreased 2.5% year-on-year in December, sharper than the 2.3% decline seen in November. Prices were expected to drop 2.4%. Prices have been falling since March.

On a monthly basis, producer prices slid 0.2%, as expected, following a flat reading in November. For the full year 2025, producer prices declined 1.2% compared to a fall of 1.8% registered in 2024.

A report from the European Central Bank said the euro area current account surplus declined sharply in November as the surplus on goods trade decreased and the primary income deficit widened.

The seasonally and working-day-adjusted current account surplus fell to EUR 9.0 billion from EUR 27.0 billion in October. In the same period last year, the surplus totaled EUR 23.0 billion.

The surplus on goods trade shrank to EUR 24 billion from EUR 33 billion in the previous month, and the surplus on services decreased to EUR 12 billion from EUR 13 billion.

In economic news, the UK unemployment rate remained stable and wage growth eased in the three months to November, data from the Office for National Statistics showed.

The jobless rate was estimated at 5.1%, unchanged from the three months to October and also matched expectations.

Average earnings excluding bonuses posted an annual growth of 4.5%, which matched economists’ forecast but slower than the 4.6% rise in the preceding period.

During October to December, vacancies showed an increase of 10,000 to 734,000 compared with July to September period.