The European stock market rebounded strongly on Thursday, after US President Donald Trump declared a temporary suspension of full reciprocal duties on the majority of trade partners. This announcement offered a short reprieve in ongoing trade tensions.
The US market failed to maintain its momentum and entered negative territory.
The best day for European stock prices in recent years
Stoxx 600 Index jumped by 3.7%. This is the highest session for three years.
All sectors ended the year in positive territory.
The rise in the banking, industrial and technology stock sectors was led by a 5.15 %, 4.9 %, and 4.5 % respectively.
The DAX Index in Germany rose 4.67% and led gains across major European markets.
The CAC 40 index in France advanced by 3.8% while the FTSE 100 Index gained 3.04%.
Due to its large exports, Germany will be one of the countries most affected by the new US tariffs.
After a turbulent week, the index had closed at its lowest point since January 2024 only a single day before.
Trump announced late on Wednesday that new tariff rates would be suspended for 90 days, a change from his previous position.
In response, the European Union will also pause their counter-tariffs for 90 days in order to give room for negotiation, European Commission president Ursula von der Leyen stated in a Thursday post.
The EU’s countermeasures, she said, have been finalized with the strong support of its member states. However their implementation is likely to be delayed.
Tariffs are imposed if the discussions fail to produce a satisfactory result.
US Markets Slip on Thursday
US stocks surged Wednesday after Trump’s decision. The S&P 500 gained more than 9%. This is the third largest one-day gain since World War II.
The enthusiasm quickly faded. All three of the major indexes changed sharply on Thursday.
The Nasdaq Composite dropped 654 points or 3.8% to 16,407.91. S&P 500 fell 174.60 or 3.2% to 5,282.30 while Dow Jones Industrial Average dropped 1,068 or 2.6% to 39,540.41.
As concerns over economic growth returned, investors appeared to lock in their profits.
The data on inflation released Thursday morning was mostly ignored by traders.
According to Bureau of Labor Statistics data published Thursday, US inflation declined more than anticipated in March.
Consumer price index (CPI), adjusted for season, fell by 0.1%. The annual inflation rate dropped to 2.4% in March from 2.8%.
The core inflation rate, which does not include food or energy, increased by 0.1% and fell to 2.8% on an annual basis — its lowest level since March 2021.
The headline inflation rate and the core inflation rate were both below Wall Street’s expectations.
According to Dow Jones, the annual inflation rate was 2.6% for headline and 3% for core.
The post European Stocks Register Best Day in Years: DAX Up Over 4% and FTSE Jumps 3% could be updated as new information becomes available.
