European markets rally as US-China tariff pause lifts sentiment
Stock markets across Europe are posting strong gains as investors welcome news of a 90-day truce in the trade war between the United States and China.
Germany’s DAX has jumped 1.5%, buoyed by hopes that trade tensions are easing. Automotive stocks led the charge in Frankfurt, with Mercedes-Benz and Daimler Trucks both climbing 5.5%, and BMW not far behind with a 5.4% rise.
France’s CAC 40 also advanced, rising 1.2%, amid broad optimism over the tariff reductions agreed by Washington and Beijing.
While the agreement is not a full resolution, markets are encouraged by the shift in tone. Ahmad Assiri, a research strategist at Pepperstone, commented:
“Economically, this step back in tariffs is not a structural fix or a comprehensive deal. But it signals a change in tone or at the very least a political willingness to pause… It may help pave the way for more serious talks over the coming three months. Markets read this as a sign that progress is possible—not guaranteed, and not permanent, but at least it’s a step forward.”
In the UK, the FTSE 100 is lagging, edging just 10 points higher (0.03%). However, mining stocks are seeing strong gains, with Glencore up 6.3% and Anglo American climbing 6.2%.
The index’s overall progress is being capped by a sharp drop in AstraZeneca shares, which fell 4% after US President Donald Trump pledged to use executive powers to reduce prescription drug prices.
Dollar surges as US-China tariff truce boosts confidence
The US dollar strengthened sharply against major global currencies after Washington and Beijing agreed to slash tariffs by 115% for a 90-day period, a move that lifted investor sentiment and demand for the greenback.
The dollar rose 1.2% against the euro, pushing the single currency down to $1.111—its weakest level so far this year.
Sterling also fell, slipping 0.9% to $1.317, while the Japanese yen dropped 1.7%, with one dollar now buying 147.7 yen, or approximately $0.007 per yen.
