London: European stock markets ended Tuesday with notable declines as the escalation of trade tensions triggered by US President Trump's decision to impose 25% tariffs on imports from Canada and Mexico raised alarms of a potential global trade war. The financial markets reacted sharply to these developments, reflecting the growing anxiety among investors.

According to Anadolu Agency, President Trump not only implemented tariffs on Canada and Mexico but also increased previously imposed tariffs on China from 10% to 20%. This move prompted immediate retaliatory actions from the affected countries, each announcing their own tariffs on American goods. Canada announced a 25% tariff on $155 billion worth of US goods, while Mexico's president indicated that retaliatory measures would be revealed on Sunday. Meanwhile, China imposed tariffs ranging from 10% to 15% on certain US food products.

The impact of these developments was felt across European stock markets, with notable declines in the shares of several companies. Carmaker Stellantis experienced a significant drop of 10%, while Mercedes-Benz saw its stock fall by 4.8%. However, not all sectors were negatively affected; French defense firm Thales saw an initial surge of up to 12% in its stock price after reporting higher income and revenue for 2024, ultimately closing with a 2.5% increase. This was part of a broader trend among European defense companies, which saw positive movements amid expectations of increased military expenditures in Europe.

The pan-European Stoxx 600 index declined by 2.14%, a reduction of 12.06 points, closing at 551.07. Germany's DAX 40 index suffered a more pronounced fall of 3.54%, losing 820.21 points to settle at 22,326.81. In the UK, the FTSE 100 index decreased by 1.27%, equivalent to 112.31 points, finishing at 8,759. France's CAC 40 index also experienced a decline of 1.85%, dropping 151.79 points to 8,047.92. Italy's FTSE MIB 30 index saw a significant reduction of 3.41%, falling 1,333.24 points to close at 37,736.16.