Optimism and Rising Expectations in European Markets Despite the Trade War

European markets opened on a slight rise on Tuesday, April 15, 2025, amid cautious optimism regarding the possibility of a ceasefire in the U.S. tariff policies under President Trump’s administration.

The "Stoxx 600" index rose by 0.6% at the opening, with most sectors gaining, except for the household goods sector. The automotive sector led the gains, rising by 2.5%, after Trump stated on Monday that he "seeks to assist some car companies" in reference to dealing with the 25% import tariff on cars

The German DAX index increased by 0.9% to 21,147.65 points, while the UK's FTSE 100 rose by 0.5% to 8,176.74 points

On the other hand, LVMH’s stock fell by 6.35%, after Q1 sales came in below expectations

Regional markets ended Monday’s session on a positive note, as investor sentiment was boosted following the announcement of the U.S. exemption of several tech products from tariffs. Trump also stated on Sunday that he would announce the tariff rate on semiconductor imports this week, which strengthened investor confidence on Wall Street during Monday’s session and led to an increase in most markets across the Asia-Pacific region overnight

Will This Optimism Last

However, there are still questions regarding how long the temporary grace period granted by Trump under the "reciprocal tariffs" plan will last, and how countries will be able to negotiate to avoid similar retaliatory actions. European negotiations last week announced a temporary suspension of countermeasures for 90 days in order to engage in discussions

These developments suggest that European markets are reacting positively to the expectations of tariff reductions, but a sense of caution still prevails among investors due to the ongoing global trade tensions