US Tax Plan Ignites Trade War Fears!

US Tax Plan Ignites Trade War Fears!

European Stock Markets and Currencies in Focus as US Fiscal Policy Concerns Mount

The German Dax index continued its downward trend on Monday, with a midday reading of approximately 23,840 points, a 0.7 percent decline from the previous day’s close. The top performers in the market included Heidelberg Materials, Rheinmetall and Fresenius, while Sartorius, Daimler Truck and Infineon lagged behind.

Market analyst Andreas Lipkow attributed the selective positioning of investors to defensive sectors, citing the US’s recent focus on taxation and foreign trade. “There are plans to introduce special taxation on foreign investors on US financial markets, which are currently causing renewed uncertainty” he said. “These plans are not new, but seem to be gaining momentum in light of the US’s fiscal situation.”

The potential impact of such a tax on the US financial markets is difficult to predict, Lipkow noted. However, the development has introduced a new variable to the upcoming summer of stock market trading. The EU, in turn, is considering a special tax on US services, which could escalate the trade tensions between the two economic regions.

Meanwhile, the euro was stronger against the US dollar, with one euro equivalent to 1.1423 US dollars and one dollar to 0.8754 euros. The Brent crude oil price also surged, rising 3.4 percent to 64.93 US dollars per barrel by midday German time.