European stock markets declined on Friday following U.S. President Donald Trump’s latest move to impose a 35% tariff on Canadian imports starting August 1, escalating tensions with a longtime ally over the country’s alleged involvement in fentanyl trafficking into the U.S.

Trump also floated the idea of introducing across-the-board tariffs—ranging from 15% to 20%—on the majority of U.S. trade partners, and hinted at an upcoming “major statement” on Russia, further unsettling global investors and prompting a risk-off tone.

Market participants are also bracing for potential new levies on European Union goods. The U.S. currently maintains stiff tariffs on EU exports, including 50% on steel and aluminum, 25% on automobiles, and 10% on other imports.

In Friday trading, London’s FTSE 100 dropped 0.6%, while Germany’s DAX and France’s CAC 40 each fell by 1.0%, reflecting broad-based concerns about trade policy and global economic headwinds.

On the corporate front, BP Plc (LSE:BP.) saw its shares move higher after announcing that it expects both improved oil output and a strong trading performance in the second quarter.

In contrast, Carclo (LSE:CAR) plunged following news of a delay in the release of its audited financial results, raising concerns about the precision engineering firm’s financial reporting.

Meanwhile, Norwegian Air Shuttle shares soared after the budget airline reported a solid performance for the second quarter, boosting investor confidence in the company’s operational turnaround.

Turning to macroeconomic indicators, the U.K. economy unexpectedly contracted in May, driven by a notable drop in industrial activity. According to the Office for National Statistics, gross domestic product fell 0.1% in May, following a 0.3% decline in April.

In France, consumer price inflation climbed to 1.0% in June, up from 0.7% the previous month, according to revised data from the statistical agency INSEE. The figure was also revised higher from an earlier estimate of 0.9%.

Over in Germany, wholesale prices accelerated on a yearly basis, rising 0.9% in June, according to Destatis. That marks the fastest pace in three months, following April’s 0.4% increase.

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