US President Donald Trump has stoked the current turbulence with sharp tariff increases on major trading allies. Imposed is a 34% levy on Chinese imports and a 20% duty on selected European products. This stirs up fresh specters of a global trade war, casting a shadow over equities and corporate earnings prospects.
Goldman Sachs has weighed in with a fresh analysis; Chief Equity Strategist, Peter Oppenheimer, highlights significantly increased risks for European firms. He finds that, unlike in 2013, now 30% of the assets of European corporations lie in the US — a major exposure.
On average, companies in the Euro STOXX 600 index derive 26% of revenues from North America. Yet, sectoral risk varies widely; while for industries heavily entwined with the US market, the risks are profound, others remain partially insulated.
Among the most exposed are Dutch supermarkets like Ahold Delhaize, UK’s equipment rental provider Ashtead Group, Germany’s health care powerhouses Fresenius Medical Care, and distribution firm Bunzl. Caterers Compass Group, credit agency Experian, publishers like Pearson, media giants, healthcare providers, and tech companies round out the list of those facing significant challenges. So far, though, pharmaceutical giants have managed to avoid the tariff net.
However Goldman Sachs forecasts a marked increase in the possibility — now standing at 45% — of a US recession should all tariffs come to pass.
Those primarily performing within their domestic markets, such as utilities, telecom providers, and the real estate groups of France, Germany, and Spain may better withstand the gale of tariffs. These firms, like financial services giants and Italian hearing aids provider Amplifon, limit their loan to US market shifts.
Goldman Sachs warns of a triple whammy for European investors — heightened tariff risks, expected weaker US growth, and a sagging dollar — which threatens to diminish the euro value of profits earned across the Atlantic.
The market outlook is indeed dimming. Goldman Sachs has slashed its earnings forecast for European firms. They now predict a 7% dip in earnings per share for 2025, with flat growth expected in 2026. These downward revisions beat a weary drum that echoes the historical sting of recessions on European earnings, typically shrinking by 20% on average, with sectors exposed to the economic cycle plummeting by 30% to 40%.
Source: https://www.euronews.com/business/2025/04/08/which-european-firms-and-industries-are-more-vulnerable-to-us-tariffs
