The surprise move is another setback for the sector that has been roiled by several travel bans across the world and falling passenger volumes amid the virus outbreak, which has been declared a pandemic.
Trump's move sent shivers through stock markets with the pan-European STOXX 600 dropping 4%, mainly dragged down by the travel & leisure sector.
Air France KLM shares, which have lost more than half of their value since the coronavirus outbreak in Europe, dropped 15% to August 2012 lows.Germany's Lufthansa and British Airways and Iberia-owner IAG fell 9%. Cruise operator Carnival plunged to 11-year lows.