European shares close flat as investors weigh US tariff impact on earnings
Investors were eagerly awaiting the latest round of company outlooks, as these were the first quarterly reports issued since trade uncertainty overwhelmed markets.
The pan-European STOXX 600 index was last at 550.24 points, with the auto sector the hardest hit during the day.
Among European luxury carmakers, Porsche dropped 1.6% and Aston Martin slumped 10% after saying they were lifting prices on their cars exported to the US as a result of tariffs.
Germany's Mercedes-Benz also slid 3.4% after the carmaker estimated a nearly $420 million tariff impact.
Adidas also warned it may have to hike prices in the United States after reporting US tariffs would add around 200 million euros ($231 million) to costs in the second half. Shares of the sportswear brand plunged 11%.
Still, analysts broadly expect corporate health to improve after the US and EU reached an agreement to reduce tariffs to 15% on EU goods, averting a broader trade war.
'My personal surprise is that (European companies) are adapting very quickly to this new context,' said Alberto Matellan, general manager of MAPFRE's French asset management subsidiary La Financiere Responsable.
'Maybe tariffs are the trigger to be quicker in adapting to a global shift that was going to happen anyway.'
However, the levies were much higher than earlier this year, and duties on certain sectors such as beverages were still to be decided.
The deal also had market participants reassessing their bets on European stocks after a bumper rally earlier in the year. Wall Street's S&P 500 has posted the biggest gains for the year, outperforming the STOXX 600.
Meanwhile banks, which are less exposed to trade concerns, were up for a second day and hit their highest since early 2010.
Swiss bank UBS rose 1.1% after reporting its second-quarter profit more than doubled from last year, while HSBC Holdings fell 3.8% on posting first-half pretax profit below estimates.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
6 hours ago
- Business Recorder
PM Shehbaz backs Iran's right to peaceful nuclear power in joint presser with Pezeshkian
Prime Minister Shehbaz Sharif on Sunday reaffirmed Pakistan's support for Iran's right to acquire nuclear power for peaceful purposes. 'Pakistan stands by Iran for the acquisition of peaceful nuclear power,' the prime minister said during a joint press conference with Iranian President Masoud Pezeshkian, who is on a two-day maiden visit to Pakistan. The statement comes amid renewed global scrutiny over Iran's nuclear programme, which recently became a flashpoint in its conflict with Israel. In response to rising tensions, the United States launched strikes on multiple nuclear-related sites in Iran earlier this year. The conflict has drawn international attention to Tehran's atomic ambitions. Meanwhile, Iran has resumed nuclear talks with European powers, France, Germany, and the United Kingdom, following a proposed end-of-August deadline for a new agreement. According to the International Atomic Energy Agency (IAEA), these discussions have been described as 'frank' and may pave the way for renewed inspections of Iranian nuclear facilities. He welcomed President Pezeshkian and his high-level delegation to Pakistan and praised the Iranian leadership for 'wisely and bravely responding to aggression' in recent conflicts. 'Pakistan's 240 million people strongly condemned the recent Israeli aggression against Iran,' PM Shehbaz said, praising the courage of the Iranian people and armed forces. He offered prayers for the martyrs and speedy recovery of the injured, while calling the Iranian response a 'remarkable victory led with wisdom.' The reaffirmation of support comes at a time when Iran's nuclear programme remains under international spotlight, particularly following Israeli strikes on nuclear-linked sites and growing pressure from the United States and European allies to conclude a nuclear deal. Talks between Iran and European countries, France, Germany and the UK, have resumed, with the International Atomic Energy Agency (IAEA) expressing cautious optimism about future inspections. While many global actors have raised concerns over Iran's nuclear ambitions, Islamabad's stance has remained consistent, advocating for peaceful nuclear use under international law. PM Shehbaz noted that both countries had signed several key Memorandums of Understanding (MoUs) during the visit, which would soon be formalised as binding agreements. 'Our target is to raise bilateral trade to $10 billion, and we will achieve this soon,' he said, adding that Pakistan and Iran share a common vision on combating terrorism and ensuring regional peace and development. Both sides also discussed strengthening border security and accelerating joint development projects. President Pezeshkian said Tehran is actively working with Islamabad on plans to establish joint economic zones and boost cross-border trade. The Iranian president emphasised that relations between Iran and Pakistan go beyond geography and economics, anchored instead in shared culture, faith, and ideology. 'Allama Iqbal's poetry is not just Pakistan's legacy — it is a guiding light for the entire Muslim world,' he remarked, stating that Iqbal's message of Muslim unity lies at the heart of Iran's regional policy. President Pezeshkian added that cooperation with Pakistan was a central pillar of Iran's foreign policy. He expressed satisfaction with the outcome of meetings held with Pakistan's political and religious leadership, which he said contributed to enhanced trust and harmony between the two neighbours. Condemnation of Israeli actions in Gaza Both leaders strongly condemned Israeli actions in Gaza. Prime Minister Shehbaz said: 'Innocent women and children are being killed every hour in Gaza, and even food is being weaponised against the Palestinian people. The world must speak up, and there is an urgent need for an immediate ceasefire.' He linked the suffering in Gaza to the long-running situation in Indian-administered Kashmir, stating that 'Kashmir has been soaked in the blood of innocent people' and urging the international community to view both crises through the lens of justice and human rights. President Pezeshkian warned that Israel's aggression in Gaza, Lebanon, and Syria was part of a broader agenda to destabilise the region. He urged the United Nations and especially the Security Council to take effective and immediate notice of Israeli actions. 'If the world wants peace, Muslim countries must unite under a common stance,' the Iranian president said, calling regional development and security deeply interlinked. Shared resolve and way forward President Pezeshkian concluded with a firm pledge to carry forward all MoUs and turn intentions into action without delay. 'This is a moment for urgent decisions. Delays will only increase complications,' he said. Both sides reaffirmed their commitment to closer engagement at all levels, political, economic, cultural, and security, and underscored the need for unity within the Muslim world in the face of regional and global challenges. Earlier, PM Shehbaz received President of the Islamic Republic of Iran, Dr Masoud Pezeshkian, at the Prime Minister's House. Upon his arrival, a guard of honour was presented by a contingent of the Pakistan armed forces, while the national anthems of both countries were played. The Iranian president was introduced to members of the federal cabinet, and Prime Minister Shehbaz also held a brief interaction with the accompanying Iranian delegation. As part of the ceremonial proceedings, President Pezeshkian planted a sapling in the lawn of the PM House. Iran seeks to boost trade to $10bn level Earlier, the Iranian president held a meeting with Deputy Prime Minister/Foreign Minister Senator Ishaq Dar in Islamabad. Welcoming the Iranian President, the DPM Dar reaffirmed Pakistan's deep commitment to its historic and brotherly ties with Iran, emphasising their strong foundations in shared history, common cultural heritage, faith, and mutual respect. President Pezeshkian appreciated Pakistan's support and reaffirmed Iran's commitment to enhancing bilateral cooperation in various areas of shared interest. He also looked forward to meaningful discussions with Pakistani leaders to further reinforce the political and economic ties between the two friendly nations. The two sides exchanged 12 agreements and MoUs for the promotion of bilateral cooperation in diverse fields. The exchange ceremony was held in Islamabad on Sunday, in the presence of Prime Minister Shehbaz Sharif and Iranian President Dr Masoud Pezeshkian. The agreements and MoUs included cooperation for plant protection and plant quarantine, joint use of Mirjaveh-Taftan border gate, collaboration in science, technology and innovation, cooperation in information and communications technology, exchange programs for culture, art, tourism, youth, mass media and exports, cooperation in meteorology, climatology and related hazards. MoUs were also signed on maritime safety and firefighting, judicial assistance in criminal matters, a supplemental MoU to an MoU in 2013 related to air services agreement, MoU on recognition of products certification, inspection and testing, tourism cooperation for 2025-27 and a joint ministerial statement on the intent to finalise Free Trade Agreement. A luncheon in honour of the Iranian President was also arranged at the Prime Minister's House, which was attended by senior government officials and diplomats. Sources say that the Iranian president is also scheduled to hold separate meetings with Senate Chairman Yousaf Raza Gilani and National Assembly Speaker Ayaz Sadiq, in which the two sides will discuss promoting cooperation at the parliamentary level. Later this evening, President Pezeshkian is scheduled to meet President Asif Ali Zardari, where the two presidents will discuss expanding bilateral relations. President Zardari is also expected to host a state dinner in honour of Dr Masoud Pezeshkian. According to diplomatic sources, the Iranian president's visit is being seen as the beginning of a new chapter in Pak-Iran relations, aimed at further strengthening economic and diplomatic ties between the two neighbours.
Business Recorder
20 hours ago
- Business Recorder
Japanese rubber down
SINGAPORE: Japanese rubber futures fell across major Asian exchanges on Friday and posted their first weekly decline following a six-week rally, pressured by subdued global demand and muted stimulus signals from China's Politburo meeting. The Osaka Exchange (OSE) rubber contract for January delivery was down 0.7 yen, or 0.22%, at 314.8 yen ($2.09) per kg. The contract has lost 5.09% so far this week. The rubber contract on the Shanghai Futures Exchange for September delivery dipped 410 yuan, or 2.79%, to 14,310 yuan ($1,985.07) per metric ton. The most active September butadiene rubber contract on the SHFE fell 125 yuan, or 1.08%, to 11,455 yuan ($1,589.03) per metric ton. In July, factory activity declined across Asia as weak global demand and ongoing uncertainty over US tariffs weighed on sentiment, PMI data showed. This week's highly anticipated Politburo meeting delivered no major policy shifts, as leaders reiterated their commitment to supporting the economy by regulating 'disorderly competition', but showed no sense of urgency to roll out major stimulus. Meanwhile, top rubber producer Thailand's meteorological agency forecasted less rain from August 1 to 4. The yen fell to 150.73 per dollar as US President Donald Trump imposed a new wave of tariffs. A weaker currency makes yen-denominated assets more affordable to overseas buyers. Japan will continue to push the US to implement a cut in automobile tariffs to 15% from 25%, a concession that European automakers have already secured, though major companies like Volkswagen, Porsche, and Mercedes-Benz have revised their outlooks downward. Automobile sales could influence the intensity of automobile manufacturing, which involves using rubber-made tyres. The front-month rubber contract on Singapore Exchange's SICOM platform for August delivery last traded at 164.2 US cents per kg, down 1%.
Business Recorder
a day ago
- Business Recorder
Romania offers Constanța Port as gateway for Pakistani exports to Europe
Romania has proposed the use of its Port of Constanța to provide Pakistan direct access to European markets via the Black Sea and Danube River. The initiative was welcomed by Islamabad, calling it a viable step toward diversifying Pakistan's export logistics. The development came during a meeting between Federal Minister for Commerce Jam Kamal Khan and Romanian Ambassador to Pakistan, Dan Stoenescu, during which they discussed enhancing cooperation in trade, logistics, defence, energy, and culture, read a statement released by the Ministry of Commerce. Both sides discussed boosting agri-trade, meat exports, and potential cooperation in pharmaceuticals, surgical goods, fans, and green energy. 'On energy, Romania expressed readiness to support Pakistan's shift to green energy, offering technology in solar and wind power,' read the statement. Vietnam keen to invest & trade with Pakistan, says Kamal Acknowledging Pakistan's competitive edge in several sectors, Romania expressed interest in deeper industrial collaboration. Jam Kamal apprised the Romanian envoy that the government has started reducing tariff and non-tariff barriers. 'This offers lucrative incentives for Romanian companies to invest in Pakistan through JVs,' he said. Ambassador Stoenescu acknowledged the remarkable growth of Pakistan's IT industry and commended the talent and capabilities of Pakistani professionals in this sector. He noted that Romania offers significant opportunities for Pakistani tech professionals and expressed willingness to facilitate such exchanges. Meanwhile, the commerce minister highlighted the policy initiatives undertaken by the government to promote the IT sector. Both sides agreed to strengthen cooperation in the technology sector. During the meeting, cultural diplomacy and community integration were also addressed, with calls to improve connectivity and visa facilitation.
