European shares gain as auto stocks drive higher

European shares are higher amid news the EU auto industry could avert the need to pay US tariffs on imports.

European shares gain as auto stocks drive higher

European shares are in the green Thursday, as reports suggest the US could end its threats to impose tariffs on cars imported from the EU – if the EU removes its tariffs on vehicles imported from the US. However, concerns that the US-China trade tariffs could go ahead from July 6th tempered optimism a little.

By 1240 BST, the EUROSTOXX 600 was 0.80% higher, while the EUROSTOXX 50 had gained 1.28%. Regional bourses were also brighter. The German DAX moved up 1.49%, the French CAC was 1.21% in the green and the Spanish IBEX rose 1.52%.

US-EU car tariffs

US President Trump’s threats to impose a 20% import tax on cars imported from the EU, have been weighing on auto sector stocks for some time.

However, a report in a German newspaper suggests that Trump could be willing to drop his threats if the EU removes its tariffs on cars imported from the US.

A Reuters report on the German paper’s article said that the US ambassador to Germany, Richard Grenell, told German car executives from Daimler, VW and BMW, that Trump wanted the EU to end tariffs on US cars, a move that would see him remove further threats of hiking EU car import tariffs.

The news saw German auto stocks surge during Thursday trade:

  • Daimler shares are 4.74% higher at €59.05.
  • BMW shares gained 5.30% to trade at €81.89.
  • VW shares were 4.47% higher at €147.20.

Other stock movers

Aside from the moves in car maker stocks, investors are showing interest elsewhere too.

Sodexho shares gained 7.24% to hit €88.88 Thursday following a better-than-expected nine-month revenue report. News that Bellon, the controlling shareholder upped its stake also buoyed the stock.

Dutch oil and gas industry firm SBM Offshore shares, meanwhile, lost 5.08% to trade at €13.09 following a court ruling that meant Petrobas could withhold some payments to the firm.

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