Danish stocks experienced a decline following US President Donald Trump’s threat to impose a 30 percent tariff on goods from Europe to the US starting August 1st.

The Danish C25 index, which tracks the 25 most valuable and actively traded stocks on the Copenhagen Stock Exchange, fell by 0.7 percent to around 1720 on Monday morning.

Jacob Pedersen, Head of Equity Analysis at Sydbank, suggests the muted market reaction indicates a lack of conviction that the tariff will actually be implemented.

He further explained that investors have become accustomed to Trump’s negotiation tactics, leading to the restrained stock movements.

Trump’s past tariff threats have triggered significant stock declines, such as the 6.2 percent drop in the C25 index on April 2nd when punitive tariffs were announced, marking the second-largest drop ever, only exceeded by the market’s reaction to the COVID-19 lockdown.

Despite deteriorating earnings prospects since the beginning of the year, stock markets have largely recovered, approaching record levels due to a large tax agreement in the US and substantial investments from the EU.

Other European markets also experienced declines, with the German DAX down 0.8 percent and the French CAC40 down 0.5 percent on Monday morning.