European Shares Set To Fall On Tariff Worries

European stocks are likely to drift lower on Monday as worries persist over U.S. President Donald Trump’s trade and immigration policies.

The Trump administration said on Sunday night it was pausing punitive tariffs against Colombia after its leader agreed to grant entry to U.S. military flights carrying deported migrants.

Trump had threatened tariffs and sanctions on the country to punish it for earlier refusing to accept military flights as part of his sweeping immigration crackdown.

Meanwhile, Greenland Prime Minister Múte Egede has announced a desire to obtain independence from Denmark in the wake of Trump’s comments about buying the island territory.

Trump repeated the threat on Saturday, claiming that the annexation by the U.S. of the resource-rich Arctic Island was necessary “for the protection of the free world.”

Investors also await cues from tech earnings and key central bank meetings for direction.

Microsoft Corp., Meta Platforms, Intel, Tesla, IBM, Apple, Boeing, General Motors and Starbucks are among the big-name companies that are scheduled to unveil their earnings results this week.

The U.S. Federal Reserve is widely expected to hold interest rates steady at the end of its two-day meeting on Wednesday after a 100 basis points of cuts last year.

Several key U.S. economic reports may also attract attention this week, including a report on personal income and spending that includes the central bank’s preferred inflation readings.

Closer home, the European Central Bank is expected to cut its benchmark deposit rate by a further quarter point to 2.75 percent on Thursday, marking its fourth reduction in a row.

Asian markets were broadly lower as Chinese factory activity data disappointed and Chinese start-up DeepSeek AI’s advanced model outperformed U.S. counterparts, raising concerns about a challenge to America’s global leadership in artificial intelligence.

Gold ticked lower on dollar strength. Oil prices fell about 1 percent after Trump on Friday reiterated his call for OPEC to cut oil prices to hut hurt oil-rich Russia’s finances and help bring an end to the war in Ukraine.

U.S. stocks ended lower on Friday but notched back-to-back weekly gains on optimism over Trump’s pro-business policies and his calls for lower interest rates and oil prices.

In economic releases, U.S. consumer sentiment declined in January for the first time in six months while existing home sales rose to a 10-month high in December, separate reports revealed.

The S&P 500 ended 0.3 percent lower after hitting a new record earlier in the session. The Dow also dipped 0.3 percent while the tech-heavy Nasdaq Composite shed half a percent.

European stocks ended on a flat note Friday, failing to hold early gains. The pan European STOXX 600 finished marginally lower.

The German DAX ended flat with a negative bias and the U.K.’s FTSE 100 gave up 0.7 percent while France’s CAC 40 rose by 0.4 percent.

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