Investors are calling time on a rally in European stocks and the euro after a blistering first quarter that many fear has exaggerated how fast a planned public spending boom can revive the region's still sluggish economy and shore it up against trade war risks.

The French car lobby PFA said on Thursday that there can only be losers in the looming trade war between the United States and Europe

In Germany, Europe’s most populous nation and its largest economy, Trump’s tariffs stoked fears of the end of trade-based prosperity.

Germany on Friday warned of a potential trade war after US President Donald Trump announced a 25% tariff on automobile imports. Germany aims to “prevent a customs spiral, a tariff war” and continues negotiations with the US to ease trade tensions, Economic Ministry spokesman Korbinian Wagner told reporters in Berlin.

Proliferating tariffs engulfing the U.S., China and their partners draw parallels to the protectionist spiral of the 1930s.

American winemakers are feeling the effects of President Donald Trump’s looming tariffs on European wine and spirits.

Leaders in both countries warned that tariffs would fan inflation in the United States and upend global supply chains.

Vance was correct and mistaken at the same time, said Marko Papic, who advises institutional investors about geopolitics as chief strategist at BCA Research. Objectively, he said, the Suez looms much larger for European commerce than U.S. trade.

Merchants purchase goods at China Yiwu International Trade City, in Jinhua, Zhejiang Province, on Feb. 9, 2025. Editor at Large Christmas comes early to Yiwu, a bustling entrepôt just a couple hours by train from China’s coastal megacity of Shanghai.