FRANKFURT: European shares extended gains on Monday, with most sub-indexes rising, as investors remained optimistic about US-China trade tensions easing ahead of the week’s earnings and economic data.
The pan-European STOXX 600 index ended 0.5% higher, its fifth winning session in a row - a feat last seen in January.
Beijing on Friday exempted some US goods from its 125% retaliatory tariffs, according to businesses notified, indicating a readiness to rein in the conflict between the world’s two top economies.
US Treasury Secretary Scott Bessent on Sunday did not back President Donald Trump’s assertions that talks with China on tariffs were taking place. China has repeatedly denied such claims.
“There’s an improved mood towards possible de-escalation of the US-China trade war,” said Fiona Cincotta, senior market analyst at City Index.
“As long as we’re seeing Trump stay on his less aggressive stance, then that can continue to feed optimism.”
Also helping sentiment was Russian President Vladimir Putin’s declaration of a three-day ceasefire in May in the war with Ukraine to commemorate the victory of the Soviet Union and its allies in World War Two.
The heavyweight healthcare index led the gains, jumping 1.3%, with Danish drugmaker Novo Nordisk adding 2.6%. An index of European banks jumped 1%.
Investors looked ahead to a roller coaster week, with key inflation reports from the euro zone and United States. The monthly US employment report is expected on Friday.
European Central Bank policymaker Olli Rehn said the ECB may cut interest rates below the neutral level, adding US trade tariffs were mostly increasing downside risks to inflation.
Major European lenders HSBC, Societe Generale , Deutsche Bank and Barclays are slated to announce their earnings this week.
Earnings from four of the so-called “Magnificent Seven” megacap tech companies, including Apple, Microsoft , Amazon, and Meta Platforms, are also due on the week.
Shares of Deliveroo surged 16.5% after the British meal delivery company said on Friday it received a takeover proposal from DoorDash on April 5.
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