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Trump’s tariffs: Unpacking the EU’s market reaction

Author

Listed:
  • Piserà, Stefano
  • Paltrinieri, Andrea
  • Galletta, Simona
  • Pichler, Flavio

Abstract

This paper explores the effect of 26 February 2025 Trumps’ tariffs announcement against Europe. As a mean of event-study analysis, we find that the announcement led to a reduction of firms’ abnormal return (AR), raw return and cumulative abnormal return (CAR) listed on the EU STOXX 600, and that its effect changes according to firms’ operating industry and size. Our results confirm the EU market dependence from US policies, warning about its vulnerability.

Suggested Citation

  • Piserà, Stefano & Paltrinieri, Andrea & Galletta, Simona & Pichler, Flavio, 2025. "Trump’s tariffs: Unpacking the EU’s market reaction," Economics Letters, Elsevier, vol. 252(C).
    • Handle: RePEc:eee:ecolet:v:252:y:2025:i:c:s0165176525002174
    DOI: 10.1016/j.econlet.2025.112380
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    More about this item

    Keywords

    Equity markets; Donald Trump; Abnormal returns; Event study;
    All these keywords.

    JEL classification:

    • G00 - Financial Economics - - General - - - General
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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