European stocks tumbled to session lows mid-trading Wednesday, with Milan’s FTSE MIB index shedding nearly 2%, amid broad sell-offs fueled by investor fears over the growth impact of new US tariffs announced by former President Donald Trump. Paris dropped 2.2%, Frankfurt fell 1.8%, and London declined 0.6%. US futures also pointed lower, with Nasdaq futures down 1.4% and S&P 500 futures off 1.2%. The sell-off hit nearly all Milan-listed shares, led by losses in FinecoBank (-4.2%), Pirelli (-3.9%), Ferrari (-3.7%), and Intesa Sanpaolo (-3.3%).
EU Trade Commissioner Maros Sefcovic stated on X that the new US tariffs reflect the initial results of the EU-US agreement, particularly the 15% all-inclusive tariff ceiling. “This strengthens the stability of European businesses and confidence in the transatlantic economy,” Sefcovic wrote. “EU exporters now benefit from a more competitive position. Work continues.”
Canadian Prime Minister Mark Carney expressed Ottawa’s “disappointment” with Washington’s decision to hike tariffs to 35% on Canadian products not covered by pre-existing trade deals. Carney announced in a statement that to protect sectors like lumber, steel, aluminum, and autos—excluded from the trilateral US-Mexico-Canada agreement—Canada “will act to protect Canadian jobs, invest in our industrial competitiveness, purchase Canadian products, and diversify our export markets.”
The announcements came after midnight in Europe but before the US deadline for the new tariffs. Trump signed an executive order imposing new measures on countries with which he closed trade deals, confirming arrangements for nations with existing agreements—including the EU—and significantly increasing tariffs on Canada. The new tariffs, ranging from 10% to 41% (with Syria facing the highest rate), were delayed from immediate implementation and are now set to take effect August 7. Additional tariffs on goods shipped by sea won’t change before October 5, 2025.
Despite European concerns, the deal struck between Trump and European Commission President Ursula von der Leyen held firm. The EU, Japan, and Britain maintained tariffs of 15%, 15%, and 10% respectively. Canada faced a punitive increase from 25% to 35%, cited as a response to Ottawa’s “continued inaction and retaliation.” Switzerland’s tariff rose to 39%, exceeding the April 2nd figure. Ontario Premier Doug Ford urged Carney not to yield. Tariffs remained unchanged for India (25%) and South Korea (15%).
The White House order also stipulates a blanket 10% tariff on imports from all nations except 92 listed countries facing higher rates. It imposes a 40% tariff on goods deemed “transshipped” to evade higher duties elsewhere, primarily targeting Chinese goods repackaged in third countries. Brazil retained its 10% rate but faced an additional 40% tariff on specific goods, a move linked by observers to political tensions involving former Presidents Lula and Bolsonaro.
Separate Economic Data:**
**Eurozone Inflation:** Held steady at 2.0% year-on-year in July 2025 (flash estimate). Food, alcohol & tobacco saw the highest annual rate (3.3%), followed by services (3.1%), non-energy industrial goods (0.8%), and energy (-2.5%).
**Italian Retail Sales:** Rose 0.6% in value and 0.4% in volume month-on-month in June 2025. Food sales grew significantly (+1.4% value, +1.1% volume), while non-food sales were stable. Year-on-year, total sales value increased 1.0%, though volume fell 0.7%.
Market Openings:**
**Milan:** Opened lower, with the FTSE MIB down 0.74% at 40,682 points. European markets started weakly: Frankfurt -1.16%, London -0.46%, Paris flat.
**Tokyo:** Closed down 0.66% (Nikkei at 40,799.60), pressured by tech sector sales amid global tariff adjustments. The yen weakened against the dollar (¥148.70) but strengthened against the euro (¥169.80).
**China:** Closed mixed following the US tariff news. The Shanghai Composite fell 0.37%, while the Shenzhen Component edged up 0.02%.