FRANKFURT: European shares staged a modest comeback on Monday, shaking off Friday’s bruising selloff after US President Donald Trump toned down his aggressive trade stance toward China.
The pan-European STOXX 600 index ticked up 0.4 percent, clawing back some losses from a 1.3 percent plunge after Trump threatened a 100 percent tariff on Chinese goods in a reprisal against China for curbing its critical mineral exports.
Trump, known for his hardline rhetoric, adopted a conciliatory tone over the weekend. European markets and Wall Street recovered on easing fears of another all-out trade war.
“When it comes to tariffs, China is definitely the only country that plays hardball with the US Even though markets are taking it in their stride. We’re going to enter a period of heightened uncertainty around tariffs once again,” said Joachim Klement, an investment strategist at Panmure Liberum.
European stocks are trading just below all-time highs reached last week, with a thriving artificial intelligence trade and optimism over potential US rate cuts outweighing French political chaos. However, the spectre of a renewed trade war remains, injecting fresh volatility. Europe’s so-called “fear gauge” touched its highest level in over two months during the session.
“Investors may have thought the tariff story had run its course as a market catalyst, but last week showed it can still pack a punch,” said Chris Larkin, managing director, trading and investing, E*TRADE at Morgan Stanley. The technology sector gained 1.8 percent, with a major boost from ASML.
Basic resources jumped 3 percent as copper prices advanced on hopes of easing US-China trade tensions. France’s CAC 40 edged up 0.2 percent after Sebastien Lecornu was reappointed as the prime minister on Friday, just four days after he had resigned from the role.
The government must formally present a budget in the coming days that faces a perilous path through a deeply divided parliament. Among big movers, PSI Software surged 35.8 percent towards its highest since 2021 after private equity firm Warburg Pincus was set to buy the German software firm for more than 700 million euros (USD813.26 million), confirming Reuters reports about the deal and the offer price.
Exosens climbed 10.5 percent after Greek night vision systems maker Theon International said it plans to buy a 9.8 percent stake in its French peer. Theon’s shares dipped 1.3 percent.
Big Yellow Group jumped 15.4 percent after Blackstone Europe said it was in the early stages of considering a possible cash offer for the UK-listed self-storage company.
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