Bearish Breakfast: Euro Stocks Hit the Snooze Button After Wall Street’s Nightmare

European stock futures headed lower on Tuesday, April 22, 2025, as markets resumed trading after the Easter break, mirroring global investor anxiety after a Wall Street plummet and fresh political heat on the US Federal Reserve.

 

Key Developments:

Market Context:

The downbeat mood in Europe comes after a precipitous fall in US stocks, with the Dow Jones Industrial Average falling more than 950 points on concerns of a worldwide trade war and growing attacks on Federal Reserve Chairman Jerome Powell by former US President Donald Trump. Trump's demands for cuts in interest rates now and the threat to remove Powell from his position have fueled uncertainty over the independence of the central bank and the direction of future policy.

 

Investors are looking for shelter, with massive inflows into gold, ultra-short Treasuries, and low-volatility ETFs, a manifestation of increased risk aversion. European traders are, meanwhile, following the IMF-World Bank Spring meetings in Washington, where US tariff policy and its world implications are set to be center stage.

 

Geopolitical Tensions:

This was also exacerbated by further military action in Ukraine as Russia resumed military activity after the lapse of an Easter ceasefire. This, in addition to ongoing uncertainty in the world economy, has added to the conservative tone prevailing in European markets.

 

Outlook:

With no significant European corporate results or data releases planned for the day, market participants will likely continue to be preoccupied with macroeconomic cues from the US and any news from global policy meetings. Technical indicators on major European indices indicate ongoing downside risk in the short term.

 

Sources: Bloomberg, CNBC TV18