European shares close higher as US-China tariff truce
The pan-European STOXX 600 index closed 0.2% higher a day after starting the week lower.
Investors were relieved after Washington and Beijing extended a tariff truce by 90 days, staving off triple-digit duties on each other's goods until November 10.
'Equity markets have been pretty relaxed about all the trade news. The assumption seems to be that (US President Donald) Trump will relent on everything and that it will all be OK,' said Rob Perrone, investment specialist for Orbis Investments. 'If the news is better than yesterday's, then stocks go up.'
Most sectors on the benchmark STOXX 600 rose, led by energy with a 1.5% advance. Vestas Wind Systems outperformed peers with a 4.7% gain, after receiving US orders for undisclosed projects.
Heavyweight tech shares fell 2.1% to their lowest levels since early May. Software stocks in particular fell sharply on concerns that artificial intelligence could weaken this technology segment.
SAP slid 7%, while Nemetschek SE was down 11%, the biggest decliners on the index. The stocks logged their steepest one-day declines since 2020.
Most regional indexes were higher, but Germany's DAX , dipped 0.2%. German investor morale fell more than expected in August, an index showed.
Latest earnings forecasts showed companies are expected to report 4.8% growth in second-quarter earnings, on average, above the previously expected 3.1%, according to LSEG I/B/E/S data.
Earnings in Europe have been resilient so far, partly because the recent EU-US tariff deal has eased concerns over how Trump's levies might affect corporate performance.
Moreover, data showed US inflation rose broadly in line with expectations in July, putting the Fed on track to lower interest rates next month.
Markets also eyed a Friday meeting between Trump and Russian President Vladimir Putin on Russia's war in Ukraine.
Trump said on Monday that both Kyiv and Moscow will have to cede land to end the war.
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