European stocks were sharply lower Tuesday after President Donald Trump said that it might be better to wait until after the 2020 election to strike a trade deal with China.
The pan-European Stoxx 600 traded down by nearly 0.6% by the close of trade, as investors digested different developments on the trade front.
Speaking in London, President Donald Trump told reporters: "In some ways, I like the idea of waiting until after the election for the China deal, but they want to make a deal now and we will see whether or not the deal is going to be right."
The U.S. general election is set to take place in November 2020. Beijing and Washington D.C. had previously pointed to the possibility of signing a phase one trade deal in the last quarter of 2019.
Meanwhile, Trump also announced Monday tariffs on steel and aluminum imports from Brazil and Argentina on Monday — sparking further global trade tensions. In this context, basic resources stocks fell more than 1% as the sector is highly volatile to global trade and metal news.
Furthermore, the U.S. trade representative also said Monday that it could put duties of up to 100% on certain French products. This is on the back of France's decision to apply a tax on digital companies. The U.S. trade office concluded that the French levy is harmful to U.S. tech companies.
Meanwhile, investors are monitoring several high-level meetings as NATO leaders gather in the U.K. to celebrate the 70th anniversary of the organization. Prime Minister Boris Johnson is receiving German Chancellor Angela Merkel, French President Emmanuel Macron and Turkish President Recep Tayyip Erdogan.