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Looking ahead, investors are concerned that the next target in the trade spate could hit the automobile industry, a key support for Germany’s export industry. Barbara Reinhard, head of asset allocation at Voya Investment Management, warned that autos are much more global in nature and tariffs would heavily weigh on Europe.

Some companies are already sounding the warning bells. For instance, Daimler AG last week announced an unexpected profit warning, explaining Chinese retaliatory import duties on vehicles built in the U.S. would hit sales and profits.

“We think that the warning from Daimler […] is a line in the sand,” Voya’s Ms. Reinhard told the WSJ.

Bank of America Merrill Lynch caluclated U.S. ar tariffs at 25% would lower euro-area GDP by at least 0.3%.

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