European Shares Rise Amid Ceasefire and Trade Concerns

By Sukriti Gupta and Sanchayaita Roy

(Reuters) – European shares edged higher on Thursday, supported by signs that the Israel-Iran ceasefire appeared to be holding, while investors braced for the July 9 deadline for trade deals with the United States.

The pan-European STOXX 600 index was up 0.2% at 538.27 points, as of 0839 GMT. Other regional indexes also traded higher.

Investors have been reassured by the Israel-Iran ceasefire. U.S. President Donald Trump indicated on Wednesday that he would likely seek a commitment from Iran to end its nuclear ambitions during talks next week.

Attention is now shifting towards the upcoming July 9 U.S. tariff pause deadline. With limited progress on trade deals, aside from a U.S.-UK agreement, the European Union is scrambling to secure its own arrangements with Washington.

On Thursday, EU leaders are expected to inform the European Commission whether they prefer a swift trade deal with the U.S., even if it means conceding better terms to Washington, or to escalate the dispute in hopes of securing a more favorable outcome.

> “We haven’t heard much about a deal between U.S. and Europe and as we approach closer to the tariff deadline, it’s becoming more of a risk factor for Europe,” said Anthi Tsouvali, multi-asset strategist at UBS Global Wealth Management.

The bloc already faces tariffs of 50% on steel and aluminium, and 25% on cars and car parts. Trump has warned that tariffs could increase to 50% without an agreement.

Meanwhile, Trump labeled Federal Reserve Chair Jerome Powell as “terrible” and mentioned considering a few candidates for the position. The Wall Street Journal reported that Trump may replace Powell as early as September or October.

Among sectors, European defense stocks rose 1.3%. NATO leaders on Wednesday supported the increased defense spending that Trump has demanded.

Rheinmetall (ETR:RHMG) and Hensoldt saw jumps of 3% and 2.8%, respectively. Other notable increases included Saab at 3.2%, while QinetiQ climbed nearly 4%.

Industrial miners led the sectoral gains, rising 1.5%.

H&M (ST:HMb) rose 5.6% after reporting a slightly stronger second-quarter profit.

Inchcape (OTC:INCPY) advanced 6%, becoming one of the top gainers in the STOXX 600 after reiterating its full-year financial outlook.

Edenred (EPA:EDEN) gained 5.1% following an update from a French minister on proposed meal voucher reform.

EQT (ST:EQTAB) also increased by 5.1% after Citigroup upgraded the Swedish private equity firm from “neutral” to “buy”.

On the data front, German consumer sentiment is expected to slightly decrease heading into July, as increased household savings counteracts improving income prospects.