Shares up as Trump tariff plan faces resistance

london — Share markets in Asia and Europe regained ground on Tuesday after US President Donald Trump faced growing pressure from political allies to pull back from proposed steel and aluminium tariffs and a potential global trade war.

European sentiment was also supported after Germany reformed its coalition government to end more than five months in political limbo and as initial unease caused

Over and above the noise about (Us) protectionism, we would need to see real evidence it is damaging growth Michael Metcalfe, Head of global macro strategy, State Street Global Markets

by a hefty election vote for antiestablishment parties in Italy began to ebb.

Italian bonds gained and shares bounced almost 1 per cent having slipped to a six-month low after the weekend vote. Europe’s big three Britain’s FTSE, Germany’s Dax and France’s Cac — were up 0.5-1 per cent too, with euro a fraction higher and the pound a touch weaker as the dollar steadied.

“Over and above the noise about (US) protectionism we are getting now, we would need to see real evidence it is damaging growth and that is going to take some time,” said head of global macro strategy at State Street Global Markets, Michael Metcalfe. “...We have been here before in 2002 and 2003 with steel tariffs and that wasn’t devastating.”

Top US Republican politicians, including House speaker Paul Ryan, urged Trump on Monday not to go ahead with tariffs on foreign imports of steel and aluminium.

Even though the president said he would not back down, he suggested Canada and Mexico could be exempted if a new Nafta trade deal was agreed. There was speculation that this had been the main motivation behind the plan.