European equities posted modest gains Friday, capping a turbulent week defined by trade policy uncertainty. The pan-European STOXX 600 index rose 0.5% in early trading, buoyed by a temporary reprieve from escalating tariff threats.
Despite the recovery, the index remains on track for its third consecutive weekly decline, reflecting broader investor unease. This week alone, wild swings in U.S. tariff policy—starting with an announcement of sweeping “reciprocal” levies, followed by a surprise suspension—sparked trillions in losses across global equity markets.
Key regional indexes, including Germany’s DAX, France’s CAC 40, Spain’s IBEX, and the UK’s FTSE 100, all rose between 0.3% and 0.7% Friday morning. This follows their strongest single-day gains since 2022, recorded during Thursday’s relief rally.
Tariff Reversals Create Market Whiplash
President Joe Biden’s abrupt tariff shift prompted the European Union to suspend its planned retaliatory duties on U.S. goods, allowing space for potential negotiation. EU finance ministers are meeting Friday to discuss how best to use the pause—either to pursue a deal with Washington or prepare for further economic fallout.
At the same time, tensions between the U.S. and China remain at a boiling point. Both countries raised tariffs again this week, exacerbating fears that a prolonged trade war could depress global growth and damage key export sectors across Europe.
Analysts caution that while Friday’s uptick may reflect short-term optimism, underlying uncertainty remains high.
Key Market Data:
- STOXX 600: +0.5% (07:19 GMT)
- Germany, France, UK, Spain: +0.3% to +0.7%
- Weekly STOXX 600 decline: Expected for third straight week
- EU retaliatory tariffs: Temporarily suspended
Company Movers Reflect Broader Volatility
Corporate earnings and guidance also shaped sentiment Friday. Shares of Zurich Insurance fell 5.4% ahead of its annual general meeting, making it one of the day’s biggest losers.
Stellantis (NYSE: STLA) slipped 2.2% after reporting a 9% year-over-year decline in Q1 vehicle shipments, raising concerns about how trade friction may be impacting demand and supply chains.
Other sectors, particularly tech and consumer goods, showed slight rebounds, though gains remain fragile given the fluid geopolitical backdrop.
Notable Stock Movements:
- Zurich Insurance: -5.4%
- Stellantis: -2.2% (Q1 shipments down 9%)
- Broader consumer and tech sectors: Modest recovery
As markets digest mixed signals from Washington, Brussels, and Beijing, the short-term outlook remains cautious. Investors continue to brace for policy shifts that could reshape the global economic landscape.
