LONDON — European equity markets finished broadly lower on Friday, after U.S. President Donald Trump threatened "much higher" tariffs against the EU.
The pan-European Stoxx 600 ended the day almost 0.8% lower, with most sectors in the red, and major regional bourses in London, Paris, Frankfurt and Milan all closing negative territory.
Transatlantic trade tensions were back on the agenda during Friday's dealmaking. In a Truth Social post on Thursday evening, Trump said he had been "waiting patiently for the EU to fulfill their side of the Historic Trade Deal" that was agreed last July, when the U.S. and the EU reached a deal to lower tariffs on the European trading bloc from a threatened 30% to 15%.
In Thursday's post, Trump said the EU had promised to "deliver their side of the deal" and cut their tariffs on American goods to zero.
"I agreed to give her until our Country's 250th Birthday or, unfortunately, their Tariffs would immediately jump to much higher levels," he said of a call with EU Commission President Ursula von der Leyen.
In February, after Trump said he would impose a global blanket tariff of 15% after the Supreme Court struck down his reciprocal tariffs regime, a top EU trade lawmaker told CNBC the U.S. had breached the terms of the deal "several times."
Lawmakers in Brussels paused a parliamentary vote on the trade deal following those threats from Trump, with one official lambasting the president's move as "pure tariff chaos."
Commerzbank ended Friday 3.9% lower after the German bank reported a 1.36 billion euro ($1.6 billion) operating profit in the first quarter.
CEO Bettina Orlopp told CNBC that Commerzbank would defend shareholders' interests as the bank continues to fight a takeover bid by Italian rival UniCredit. UniCredit closed more than 1% lower.
European defense stocks also traded lower as traders assessed events in the Middle East, where both sides trading fire overnight. In a phone call with a reporter at ABC News, Trump said the strikes were "just a love tap" and insisted the fragile ceasefire between the two sides was still in effect.
German defense giant Rheinmetall fell to the bottom of the Stoxx 600, closing the day down 9.2%, while tank parts maker Renk slipped 6.4%. Italian defense mainstay Leonardo finished 3.2% lower.
Elsewhere, the U.K. is counting votes from local council elections in England, and national assemblies in Scotland and Wales. Early results include heavy losses for the governing Labour party and its main opposition, the Conservative Party. Right-wing party Reform UK and the left-wing Green party are widely expected to make gains.
Votes are still being counted, but heavy losses for Labour are expected to raise questions about Prime Minister Keir Starmer's already shaky leadership. Starmer, however, said Friday morning that he would not "walk away and plunge the country into chaos."
Yields on U.K. government bonds, known as gilts, were lower on Friday afternoon. The yield on 10-year Gilts, seen as a key benchmark for U.K. government borrowing, was little changed at 4.917%.
British pound was around 0.5% higher against the U.S. dollar at $1.36.