Europe Markets Recover 2% Amid Elevated Trade Tensions

Bridgette Randall
08 Apr, 2025
London

European markets stabilized after Monday's sharp sell-off as calm returned to world markets. 

Benchmark indexes in Frankfurt, Paris, Milan, and London traded higher by 1% as trade tensions with the U.S. remained high. 

The European Union is likely to enter negotiations with the U.S. as early as this month, and the U.S. rejected the offer of zero tariffs. 

The average tariff on the U.S. goods arriving in the European Union is less than 2%, and the European Commission president, Ursula von der Leyen, said that Donald Trump rejected the "zero-for-zero tariff" deals on industrial goods. 

Moreover, the U.S. enjoys a large service trade surplus of €109 billion on bilateral trade of €746 billion with the European Union.

The EU goods exports to the U.S. increased to €532 billion, resulting in a trade surplus of €198 billion in 2024, according to data available from the European Commission.

On the economic front, France said its international trade deficit widened in February, the largest trade gap since September, according to the latest data released by the Ministry of Economy and Finance. 

Exports stalled at €49.7 billion, and imports increased 2.4% to €57.5 billion, driven by higher purchases of hydrocarbons and transportation equipment.  

 

Europe Indexes and Yields

The DAX index increased by 1.5% to 20,079.47, the CAC-40 index edged higher 1.6% to 7,037.91, and the FTSE 100 index advanced by 1.2% to 7,792.65.

The yield on 10-year German bonds inched lower to 2.61%, French bonds decreased to 3.35%, the UK gilts moved down to 4.57%, and Italian bonds edged lower to 3.81%.

The euro increased to $1.10; the British pound was higher at $1.28; and the U.S. dollar was lower and traded at 85.76 Swiss cents.

Brent crude increased $0.12 to $64.31 a barrel, and the Dutch TTF natural gas was higher by €0.59 to €36.47 per MWh.

 

Europe Movers

Banks and energy companies topped the most actively traded stocks in Tuesday's trading. 

Deutsche Bank gained 1.7% to €18.38, UniCredit SpA advanced 0.4% to €42.83, Societe Generale SA increased 3.2% to €42.83, BNP Paribas edged up 0.6% to €66.49, and HSBC Holdings plc inched lower 0.5% to 734.19 pence.

Crude oil prices dropped for the fourth consecutive session and fell to a four-year low of $59.67 a barrel. 

Shell PLC gained 2.4% to €28.41, BP plc gained 3.1% to 359.90 pence, and TotalEnergies SA advanced 0.1% to €50.28.