European shares edged higher on Wednesday as investors assessed mixed corporate earnings and key economic data, wrapping up a volatile month dominated by disruptive US trade policy.
The pan-European STOXX 600 index was up 0.2%, as of 0834 GMT, but on track for a second consecutive monthly drop, if current trends persist.
Other regional indexes showed a mixed performance, with Germany and France up 0.5% and 0.3%, respectively, while Spain and the UK slipped 1.4% and 0.1%, respectively.
The European benchmark index has clawed back over half of its losses after tumbling nearly 18% from record highs earlier this month, sparked by fears of a global recession following US President Donald Trump’s import tariffs.
Markets have stabilized somewhat in recent weeks on optimism over potential deals between the United States and its trading partners, especially China.
However, a lack of clarity on Sino-US negotiations has kept the market sensitive to any developments. Despite Trump’s move to soften the blow of his auto tariffs and signs of progress in broader trade negotiations, details remain scant, with US Commerce Secretary Howard Lutnick saying he had reached one deal with a foreign power.
European shares end higher ahead of week’s data
The latest earnings forecasts released on Tuesday indicate an improved outlook for European corporate health. According to data from the STOXX 600 companies that have reported their first-quarter earnings, at least 60.4% of them posted better-than-expected numbers.
“It could be the calm before the storm because basically a lot of earnings are looking back to before when the US tariffs were imposed and companies seem to be doing rather well so far. The question is, will that be the case going forward? And, that is something that the markets are still waiting for,” said Axel Rudolph, senior technical analyst at IG Group.
Societe Generale rose 2.7% after the French bank reported stronger-than-expected first-quarter earnings. Danish logistic group DSV advanced nearly 9% after it completed a deal to acquire Germany’s Schenker and provided an outlook on potential benefits from the transaction.
Shares of Credit Agricole fell 4.4% after the French bank reported a drop in first-quarter profit.
Evolution slumped 16.9% as the Swedish gaming technology company reported its first-quarter earnings below estimates.
Mercedes fell 1.1% after the carmaker withdrew its 2025 earnings outlook, citing volatility due to US tariffs. Preliminary data showed modest economic growth in both France and Germany in the first quarter of 2025, with France also experiencing a sharper-than-expected rise in consumer prices in April.
The euro zone economy grew faster than expected in the first quarter, starting 2025 on a modestly upbeat note, though looming risks — including a potential trade war with the US, a stronger euro, and worsening business sentiment — threaten to undermine momentum, according to data.
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