# European stocks steady after US markets plunge

Watch: How Trump’s stock market rhetoric has shifted over the years

A sell-off in global shares eased in Europe on Tuesday following a sharp fall in US stocks that came as investors raised concerns about the negative economic impact of President Donald Trump's tariffs.

It followed the president saying in a TV interview that the world's biggest economy was in a "period of transition", when asked about suggestions of a potential recession.

Since those remarks were broadcast on Sunday, top Trump officials and advisers have sought to calm investor fears.

The US S&P 500 share index fell nearly 3% on Monday, but in Europe most of the major markets opened little changed.

In a Fox News interview broadcast at the weekend but recorded on Thursday, Trump appeared to acknowledge concerns about the economy.

"I hate to predict things like that," he said. "There is a period of transition because what we're doing is very big. We're bringing wealth back to America. That's a big thing."

Charu Chanana, an investment strategist at investment bank Saxo, told the BBC: "The previous notion of Trump being a stock market president is being re-evaluated."

On Monday in New York, the S&P 500, which tracks the biggest companies listed in the US, ended the trading day 2.7% lower, while the Dow Jones Industrial Average dropped 2%.

The tech-heavy Nasdaq share index was hit particularly hard, sinking 4%.

Tesla shares fell by 15.4%, while artificial intelligence (AI) chip giant Nvidia was down more than 5%. Other major tech stocks including Meta, Amazon and Alphabet also fell sharply.

On Tuesday, Asian stocks fell sharply at first before recovering. Japan's Nikkei 225 closed down 0.6% and South Korea's Kospi ended 1.3% lower.

The dollar slid further against the pound and the euro on Tuesday, having fallen sharply since the beginning of the month.

However, there was little sign of the turbulence spilling into Europe. While the FTSE 100 index, which tracks the biggest companies listed in the UK, dipped 0.1%, Germany's Dax index rose 0.4% and the French Cac 40 climbed 0.2%.

> Economist Mohamed El-Erian said investors were initially optimistic about Trump's plans for de-regulation and lower taxes, while under-estimating the likelihood of a trade war.
>
> He said the recent falls in the stock market, which started last week, reflect the adjustment of those bets.
>
> "It's a complete change in what the market expected," he added, noting that investors are also responding to signs that businesses and households are starting to hold off on spending due to uncertainty, which could hurt economic growth.
>
> But Kevin Hassett, an economic adviser to President Trump, has pushed back against those projecting this bleak outlook.
>
> In an interview with CNBC, Hassett said there were many reasons to be optimistic about the US economy and that that tariffs imposed on Canada, Mexico and China were already bringing manufacturing and jobs to the United States.
>
> "There are a lot of reasons to be extremely bullish about the economy going forward," he said.
>
> He admitted there were some "blips in the data" for this quarter, which he pinned on the timing of Trump's tariffs and the "Biden inheritance".

Economist Mohamed El-Erian said investors were initially optimistic about Trump's plans for de-regulation and lower taxes, while under-estimating the likelihood of a trade war.

He said the recent falls in the stock market, which started last week, reflect the adjustment of those bets.

"It's a complete change in what the market expected," he added, noting that investors are also responding to signs that businesses and households are starting to hold off on spending due to uncertainty, which could hurt economic growth.

> But Kevin Hassett, an economic adviser to President Trump, has pushed back against those projecting this bleak outlook.
>
> In an interview with CNBC, Hassett said there were many reasons to be optimistic about the US economy and that that tariffs imposed on Canada, Mexico and China were already bringing manufacturing and jobs to the United States.
>
> "There are a lot of reasons to be extremely bullish about the economy going forward," he said.
>
> He admitted there were some "blips in the data" for this quarter, which he pinned on the timing of Trump's tariffs and the "Biden inheritance".
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