European stock markets closed sharply higher on Monday, rebounding after weeks of tariff-driven volatility, as investors responded to the latest temporary US exemption for certain tech products.
The pan-European Stoxx 600 index rose 2.7%, staging one of its strongest sessions of the year.
The UK’s FTSE 100 added 2%, while Germany’s DAX and France’s CAC 40 gained 2.6% and 2.4%, respectively.
The rally was broad-based, led by oil and gas stocks, which jumped 3% despite forecasts for weaker crude prices in 2025. Bank shares also advanced nearly 3%.
Pharmaceutical heavyweight Novo Nordisk climbed 3.7% after rival Pfizer abandoned the development of a daily weight-loss pill due to a liver injury incident in a trial participant.
Luxury goods conglomerate LVMH reported a 3% decline in first-quarter revenue after the European close, missing estimates as sales dropped to €20.3 billion against analysts’ expectations of €21.2 billion, according to LSEG data.
Trump tariff uncertainty remains
The market’s recovery came after a turbulent period, with the Stoxx 600 losing over 8% in April alone, underperforming even the battered S&P 500, which has fallen 4.43% over the same stretch.
Investors remain wary of US President Donald Trump’s erratic tariff decisions, which have introduced extreme volatility across global equity markets.
Over the weekend, Trump’s administration temporarily exempted smartphones, computers, semiconductors, and other electronics from punitive tariffs — a move confirmed in updated US Customs and Border Protection guidance.
Twenty product categories have been spared from the newly-imposed 125% levy on Chinese imports and the baseline 10% tariff on imports from other countries, though a 20% tariff on all Chinese goods remains active.
Trump indicated on Sunday that a new tariff rate for imported semiconductors would be announced within the week, adding further uncertainty for global tech and manufacturing sectors.
Wall Street gives up early gains on Friday
US stocks were mixed on Monday, as an early rally driven by a surprise US tariff exemption lost steam through the afternoon.
The Dow Jones Industrial Average rose 138 points, or 0.4%, after being up more than 500 points at its intraday peak.
The S&P 500 advanced 0.4%, giving back much of a 1.8% early surge.
The Nasdaq Composite edged up 0.2%, having earlier climbed as much as 2.5% before fading into the close.
The pullback reflected persistent caution in the market, with investors wary of the unresolved trade standoff with China and the durability of any policy reprieve.
Automaker stocks rallied midday Monday after President Donald Trump signaled potential support for the sector, saying he was looking to “help some of the car companies” as they face pressure to shift production to the US.
Trump’s comments that automakers “need a little bit of time” to make that transition lifted sentiment, pushing shares of Ford Motor, General Motors, and Stellantis higher by 1% to 4%, reversing earlier losses or flat trading.
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