European stock indices closed sharply lower on Wednesday amid persistent concerns over inflationary pressures and renewed threats of US tariffs. The Euro STOXX 50 fell 0.7% to 6,065, while the STOXX Europe 600 lost 0.5% to close at 622. The US administration threatened to impose additional tariffs of up to 12.5% on several trading partners for failing to ban goods produced with forced labor, reigniting trade tensions with the EU.
At the same time, new clashes between Iran and GCC countries further undermined the fragile ceasefire in the region, pushing oil prices and Eurozone bond yields higher. Bank stocks finished notably lower, with UniCredit, BBVA, and Deutsche Bank declining between 2% and 3.7%. Luxury names also came under pressure, as LVMH slipped 3%.
In contrast, ASML rose 1.6%, supported by continued positive momentum in the semiconductor sector. Inditex gained 1.5% after reporting strong earnings.
