European Stocks Edge Higher as Tariff Hopes and Busy Earnings Week Lift Sentiment

European shares opened the week slightly higher on Monday, as investors weighed tentative signs of easing U.S.-China trade tensions and braced for a packed schedule of corporate earnings and key economic data.

• By 03:55 ET (07:55 GMT):
  • The pan-European Stoxx 600 was up 0.3%.
  • France’s CAC 40 climbed 0.5%.
  • Germany’s DAX rose 0.3%.
  • The U.K.’s FTSE 100 gained 0.3%.
  • Several other regional indices were also in positive territory.

Tariff Hopes Underpin Cautious Optimism

Investors were buoyed last week by hopes that the U.S. may be open to negotiations with China to resolve their intensifying trade dispute:

• The U.S. recently imposed at least 145% tariffs on Chinese imports.
• In retaliation, China slapped 125% tariffs on U.S. goods.

Optimism over a potential de-escalation lifted risk sentiment, but uncertainty lingers:

• Treasury Secretary Scott Bessent over the weekend did not confirm that trade talks were underway, despite earlier claims by President Donald Trump.
• Bessent noted that while Trump and Xi Jinping have a “very good relationship,” no concrete discussions had been officially initiated.
• Bessent also described the potential negotiations as a “slog”, with no timeline provided for an agreement.

Crucial Corporate Earnings Week

This week, attention will be sharply focused on a slew of major earnings reports from both sides of the Atlantic:

• In the U.S., members of the “Magnificent Seven” tech giants will report, including:
  • Microsoft (MSFT)
  • Apple (AAPL)
  • Amazon (AMZN)
  • Meta Platforms (META)
  These tech heavyweights, which have powered much of the markets’ gains in recent years, have faced renewed volatility in early 2025.
• In Europe, earnings highlights include:
  • Adidas, AstraZeneca, and Novartis on Tuesday.
  • Stellantis, Volkswagen, and Airbus on Wednesday.
  • Shell and Standard Chartered on Friday.
  • Several major banks such as Deutsche Bank, Barclays, and Santander are also set to report.

Individual stock movers:

• Airbus shares rose after finalizing a deal to take over assets from supplier Spirit AeroSystems.
• Mediobanca announced a €6.3 billion bid for private lender Banca Generali, attracting market interest.

Data Watch: Inflation and Growth Indicators

Beyond earnings, investors are awaiting:

• European inflation figures, which could influence the European Central Bank’s monetary policy outlook.
• A barrage of U.S. economic data, including:
  • Q1 GDP
  • April jobs report
  • PCE inflation figures, the Fed’s preferred gauge

These releases could be crucial in shaping the future trajectory for interest rates.

Commodity Markets

Oil prices were little changed:

• Traders remained cautious amid uncertainty around U.S.-China trade developments and OPEC+ supply plans ahead of the May 5 meeting.