European markets under pressure as trade concerns take center stage

Shares in Europe struggled to make gains on Monday morning amid ongoing concerns over global trade.

The pan-Europe Stoxx 600 was flat with auto stocks falling the most. The sector is particularly vulnerable to trade tensions. Fiat shares were down by 1.3 percent in early deals.

Global markets are focused on trade concerns after President Donald Trump said Friday that there could be an additional $267 billion in tariffs against China. The administration is also finalizing plans to impose tariffs of up to 25 percent on $200 billion of Chinese goods. Trump also suggested that Apple should move its production to the U.S. to avoid being caught up in the tariffs against China.

Meanwhile, RPC rose 22 percent and led the gains across Europe, after reporting that it is in early discussions with Apollo Global for a potential takeover.

Shares in Richemont rose 1.8 percent after the luxury goods firm announce that Jerome Lambert will take over as chief executive officer.

Investors are also digesting news out of Sweden, where a general election has led to a political deadlock. The two main political blocs almost tied with a margin of 0.3 percent separating them. More importantly, the nationalist Sweden Democrats (SD) saw a surge in support from a previous election, gathering 18 percent of the votes and placing third in the overall result.

Italy remains in the spotlight for investors ahead of the publication of the 2019 budget later this month. Speaking to CNBC over the weekend, a former director at the International Monetary Fund said that “even a minor recession” could be very dangerous, given how fragile the Italian economy is.

In terms of data, markets will be looking at balance of trade numbers out in the U.K. at 9.30 a.m. London time and inflation data due a bit later, at 10 a.m. London time.

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