European stocks closed higher on Tuesday as investors evaluated the impact of new U.S. tariffs introduced by President Donald Trump at a lower than expected 10% rate, easing some of the market’s earlier concerns about a sharper escalation in global trade tensions.
The pan-European Stoxx 600 index ended the session up 0.3%, recovering from earlier declines, while regional markets delivered mixed performances. Automotive shares, among the sectors most exposed to tariffs and export policies, led gains and finished nearly 2% higher as traders adjusted expectations following confirmation of the reduced levy.
Markets had started the week under pressure after Trump warned of a blanket 15% tariff on imports into the United States, an increase from the initially proposed 10% duty. A memo issued by the U.S.
Customs and Border Protection confirmed that Temporary Section 122 Duties would apply an additional 10% ad valorem tariff on imported goods from all countries for a 150-day period, unless exemptions apply.
Uncertainty remains over whether the new tariffs will affect the United Kingdom, which secured a 10% rate under a previous trade agreement with Washington, the lowest granted to any individual partner. U.K.
Business and Trade Secretary Peter Kyle said the government is focused on protecting businesses and maintaining the existing deal, noting that discussions with U.S. counterparts are ongoing amid concerns about further trade disruption.
European officials have also raised concerns about the potential impact of the tariffs on transatlantic trade relations. The European Parliament announced it had paused work on ratifying the U.S. EU trade agreement reached last summer, reflecting growing unease over the shifting policy environment.
In the United States, equities rebounded after a weaker previous session, with technology and software stocks recovering as investors balanced trade risks against ongoing developments in artificial intelligence.
Trump signalled that tariffs could still be increased in the future, warning that countries seeking to challenge U.S. trade policies may face higher duties, and suggested additional levies could be introduced in the coming months.
Corporate developments added to market focus. Standard Chartered reported full-year earnings showing a 16% rise in pre-tax profit to 6.96 billion dollars, though the result fell short of analyst expectations.
Net interest income rose 1% year on year to 11.2 billion dollars, exceeding consensus forecasts, while operating income grew 6% to 20.9 billion dollars in 2025. The bank said it expects operating income growth in 2026 to land at the lower end of its 5 to 7% target range. Shares closed 1.5% lower following the update.
Overall, investors remain cautious as they assess the evolving global trade landscape, with tariff uncertainty continuing to influence market sentiment and sector performance across Europe.
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