LONDON: European stocks tumbled, the euro gave back some gains, and euro zone government bond yields fell sharply on Friday after U.S. President Donald Trump said he is recommending a straight 50% tariff on goods from the European Union starting on June 1.
Europe’s broad Stoxx 600 was down 2% with auto and banking stocks both falling well over 3%.
Government bond yields also fell, as investor expectations that tariffs would hurt economic growth in the currency bloc caused them to up bets on the scale of European Central Bank easing this year.
Germany’s rate sensitive two year bond yield was last down 10 basis points at 1.73%, while benchmark 10 year yields were down 9 bps at 2.55%.
The euro was last trading 0.4% higher at $1.1313, having trimmed earlier gains.
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