Global Markets: Wall Street Falls for Second Consecutive Week, European Markets Rise

On Wall Street, stock prices fell again last week, marking the second consecutive week of declines, as investors are concerned about tariff threats, while European stock indices rose thanks to interest rate cuts in Europe.

On Wall Street, the Dow Jones weakened by 0.55 percent to 44,303 points, while the S&P 500 slipped by 0.25 percent to 6,025 points, and the Nasdaq index fell by 0.5 percent to 19,523 points.

At the very beginning of the week, these indices dropped significantly as U.S. President Donald Trump’s decision to impose tariffs on Canada, Mexico, and China raised fears of a trade war.

However, the situation soon calmed as Trump postponed the implementation of tariffs on Mexico and Canada for a month, after those two countries promised to make greater efforts at the borders to stop illegal migration and drug smuggling.

– Trump was serious when he said that tariffs would be the main tool for achieving various goals. The risk of tariffs will cause market instability in the short term – says Carol Schleif, director at BMO Family Office.

And while Washington postponed the implementation of tariffs on imports from Canada and Mexico, mid-last week, tariffs of 10 percent on imports from China came into effect.

Beijing quickly retaliated and announced the introduction of additional tariffs of 10 to 15 percent on imports of certain products from the U.S. starting February 10.

Investors hope that a trade war will still be avoided as the White House indicated that Trump will soon speak with Chinese President Xi Jinping.

And while uncertainty regarding tariffs weighs on the market, solid quarterly earnings results from U.S. companies provide support.

So far, more than half of the companies in the S&P 500 index have reported financial results, with approximately 77 percent achieving higher earnings than expected.

European Markets Rise for Second Consecutive Week

On European exchanges, stock prices rose last week for the second consecutive week. This is primarily due to the reduction in interest rates in Europe, which is expected to stimulate economic growth.

After the European Central Bank recently lowered the cost of money by another 0.25 percentage points, the Bank of England did the same last week.

As a result, the STOXX 600 index of major European stocks rose by 0.5 percent last week, reaching record levels.

Meanwhile, the London FTSE index strengthened by 0.3 percent to 8,700 points, while the Frankfurt DAX rose by 0.25 percent to 21,787 points, and the Paris CAC increased by 0.3 percent to 7,973 points.

However, the gains in the indices were not significant as investors remain cautious, given that Washington threatens tariffs against the European Union.