French spirits stocks choppy as China slaps high duties on EU brandy

Stocks open lower

Europe's stock markets are in the red across the board at the open, with the regional Stoxx 600 index down 0.4%, the U.K.'s FTSE 100 down 0.32%, Germany's DAX down 0.29% and France's CAC 40 down 0.72%.

French drinks sellers are taking an early hit, with Pernod Ricard down 3.3%, Remy Cointreau down 4.5% and luxury giant LVMH down 2.1%, as news breaks that China's commerce ministry has issued a final ruling on its probe into European Union brandy.

The investigation ruled that the bloc has engaged in dumping of the spirit, according to a Google translation of a ministry relief. According to Reuters, a tariff rate on EU brandy will be set at up to 34.9% for five years from July 5. The ministry statement notes that no anti-dumping duties will be imposed on products that meet EU industry association price commitments.

German factory orders slump

Manufacturing orders in Germany tumbled 1.4% month on month in May, statistics office Destatis said Friday, well below the expectations of a 0.1% decline forecast in a Reuters poll of analysts. Orders were up 5.3% year on year.

The monthly fall was primarily due to a 17.7% drop in computer, electronic and optical products, an area that received several big orders in April.

Air France-KLM to take majority stake in SAS

Airline group Air France-KLM says it is initiating proceedings to take a majority stake in Scandinavia's SAS, upping its holdings in the company to 60.5% from just under 20%.

Air France-KLM hopes to close the deal in the second half of next year.

The move “brings not just stability but will also allow for deeper industrial integration,” SAS CEO Anko van der Werff said in a statement.

Gloomy start for European stocks ahead

Good morning from London.

European markets across the U.K., France and Germany are heading for a negative start on Friday, according to IG data.

That follows a higher close on Thursday, with global equities boosted by a much stronger than expected U.S. jobs report. Officially, Wall Street is on a break for the 4 July holiday today.

However, investors are sure to be checking their phones for updates after U.S. President Donald Trump's flagship megabill passed in Congress. A host of changes lie ahead, including to taxes, social spending and energy policy.

We're meanwhile nearing Trump's July 9 deadline for tariff negotiations, which could see duties on key trading partners such as the European Union spike unless a deal is reached. Trump has said the U.S. will begin sending letters to countries setting out their tariff rates on exports to the U.S., with 10 to 12 nations set to receive theirs today.

Treasury Secretary Scott Bessent told Bloomberg he expects around 100 countries will face a 10% levy, the baseline of the so-called 'reciprocal' tariffs.

The EU meanwhile says it is closing in on a “framework” trade deal, but that a full agreement will be impossible to reach by July 9.