European Stocks Open Higher as China Trade Talks Dominate
European markets began the week with modest gains on Monday, as investors closely watched the evolving global trade landscape.
At 03:05 ET (07:05 GMT), Germany’s DAX index rose 0.1%, France’s CAC 40 gained 0.2%, and the U.K.’s FTSE 100 climbed 0.2%.
Last week, the main European benchmarks posted healthy gains, following Wall Street’s lead. Investors welcomed strong second-quarter earnings and the recent EU-U.S. trade agreement, which removed the risk of a costly trade war.
U.S.-China Trade Talks in Focus
However, global trade tensions remain in the spotlight. The Trump administration’s new tariffs, effective from Thursday, imposed import duties of up to 50% on certain regional economies.
The U.S.-China tariff truce is set to expire on August 12. While markets hope for an extension, uncertainty looms. A breakdown in talks between the world’s two largest economies could have serious global consequences.
On Monday, President Donald Trump expressed hope that China would “quickly quadruple” soybean imports from U.S. farmers to help reduce its trade deficit with Washington.
Earnings Season Slows
Corporate earnings were relatively quiet on Monday. U.K. building supplier Marshalls (LON: MSLH) reported a drop in first-half profit, with weaker margins in its Landscaping Products division offsetting gains in Roofing and Building Products.
Orsted (CSE: ORSTED), a Danish wind farm developer, announced a $9.4 billion rights issue, citing challenges in the U.S. offshore wind market.
JPMorgan analysts noted that the eurozone could be nearing “the time to look for the next leg higher,” but warned of ongoing stagflation risks from the U.S. and mixed European earnings.
Oil Prices Fall Ahead of Ukraine Talks
Oil prices declined on Monday, extending last week’s sharp losses. Brent crude futures dropped 1% to $65.93 a barrel, while U.S. West Texas Intermediate fell 1.1% to $63.16.
Both benchmarks fell over 4% last week after news broke that Trump will meet Russian President Vladimir Putin on August 15 in Alaska to discuss ending the war in Ukraine. Expectations are rising that sanctions on Russian oil could be lifted, potentially increasing global supply.
