Europe midday: Stocks stay down ahead of Trump tariffs; US inflation eyed

(Sharecast News) - European shares were still weaker by midday on Friday as traders braced themselves for wide-ranging US tariffs which take effect next week, while gold hit fresh highs with investors looking for safe havens amid the erratic policymaking of President Donald Trump.

The pan-regional Stoxx 600 index was down 0.2% at 545.11. Germany's DAX was off 0.4% in response to news on Thursday that US President Donald Trump would slap 25% levies on vehicle and parts imports as well. France's CAC 40 was 0.5% lower.

Auto shares tumbled around the world after the announcement on fears the move would disrupt global supply chains and spark inflation as the cost of vehicles increased.

'"Gold has been on another glittering run upwards as investors seek out safe havens for their money. The spike in prices to fresh record levels comes as the world braces for another round of US tariffs, and geopolitical uncertainty swirls," said Hargreaves Lansdown analyst Susannah Streeter.

"The price of gold has also been helped by buying from central banks, particularly by China. Part of the appeal of gold is as a hedge against inflation, which is staying stubborn in some economies amid concerns US trade policy could push up consumer prices further."

In economic news, consumer confidence in Germany has stabilised at a low level as sentiment was supported by the recent elections, though rising preferences to put money away still indicate a cautious attitude.

GfK's first survey since Germany's parliamentary elections, the forward-looking consumer climate index, inched higher to -24.5 for April from -24.6 in March. This missed the consensus forecast of -23.0.

Meanwhile, the UK economy grew more strongly than initially thought last year, official data showed, as the Office for National Statistics revised its estimate for real annual GDP in 2024 to 1.1% from 0.9%.

Leading the annual improvement were upward revisions of 0.1 percentage points in the first and second quarters of 2024. Growth in the second half was largely left unchanged, however.

Looking ahead to the rest of the day, the Federal Reserve's preferred measure of inflation, the personal consumption expenditures index, is due for release at 1230 GMT.

Derren Nathan, head of equity research at Hargreaves Lansdown, said: "Personal consumption expenditure figures are expected to show that annual core price inflation accelerated by 0.1 percentage points to 2.7% in February compared to the previous month.

"Anything hotter than this could introduce further doubt around the likelihood of further Fed rate cuts this year which would be a drag on investor confidence."

In equity news, Ubisoft shares surged as the company said it was creating a new gaming subsidiary with Chinese technology giant Tencent and investing �1.16bn into the unit.

Reporting by Frank Prenesti for Sharecast.com