European stock markets opened strongly on Monday after U.S. President Donald Trump decided to delay the implementation of 50% tariffs on European Union (EU) goods. The decision eased fears of a full-blown trade conflict between the two major economies and lifted investor confidence across the region.
Pan-European Index Climbs After Trump Delays 50% Tariffs on EU
The pan-European Stoxx 600 index rose by 0.9% around 10:15 a.m. in London. While gains slightly cooled off later, all sectors remained in positive territory.
France’s CAC 40 saw an increase of 1.2%, while Germany’s DAX performed even better, climbing 1.7% during early trade. The UK market was closed on Monday for a public holiday.
Auto Stocks Rebound on Trade Relief After Trump Delays 50% Tariffs on EU
One of the biggest beneficiaries of the delayed tariffs was the European auto sector. These stocks had suffered a 3% drop in the previous session, but recovered on Monday, trading 1% higher in the morning. Automobiles and machinery are among the EU’s largest exports to the U.S., making them highly sensitive to any trade tensions.
Gains Among German Automakers
- BMW shares gained 1.3%
- Mercedes-Benz rose 1.6%
- Volkswagen jumped 1.4%
The positive movement suggests investor relief that the industry may avoid immediate tariff pressures, at least for now.
Pharma Sector Also Sees Gains as Trump Delays 50% Tariffs on EU
Zealand Pharma was the top gainer on the Stoxx 600, with shares rising 7.3%. The surge followed continued support from financial firm Cantor Fitzgerald, which reiterated its overweight position on the stock.
Analyst Prakhar Agrawal commented that the company was “trading at a meaningful valuation disconnect,” especially considering upcoming milestones related to petrelintide and new obesity treatments.
Background: Why Trump Delayed 50% Tariffs on EU
President Trump had initially proposed a 50% tariff on EU imports, effective from June 1. In a post on his Truth Social platform, he criticized the EU for being “very difficult to deal with” and stated that trade talks were “going nowhere.”
However, following a phone call from EU Commission President Ursula von der Leyen, Trump agreed to push the start date to July 9.
Von der Leyen responded positively, sharing on social media that the EU is “ready to advance talks swiftly and decisively.”
Global Market Reaction to Trump Delays 50% Tariffs on EU
While European stocks gained, Asian markets were mixed. Japanese and South Korean shares moved higher, while stocks in China and Hong Kong declined.
U.S. markets were closed on Monday in observance of Memorial Day, but Friday had ended on a sour note due to the initial threat of new tariffs and worries surrounding tech stocks like Apple.
Market Relief as Trump Delays 50% Tariffs on EU
The delay in tariffs has provided a much-needed breather for European markets, especially sectors like autos and pharmaceuticals that are vulnerable to trade disruptions. However, with a new deadline of July 9, the relief may be temporary if no progress is made in negotiations.
Investors will be watching closely to see how EU-U.S. trade talks develop in the coming weeks and whether this pause leads to a longer-term resolution. For more such news, stay updated with 10X Times News.
