European stocks rose strongly Wednesday after a trade deal between the U.S. and Japan raised investors’ confidence, while the regional earnings season ramped up.
At 03:05 ET (07:05 GMT), the DAX index in Germany climbed 0.8%, the CAC 40 in France gained 1.3% and the FTSE 100 in the U.K. rose 0.4%.
U.S.-Japan trade deal boosts optimism U.S. President Donald Trump earlier Wednesday said his administration had completed a “massive deal” with Japan, which will see the Asian country subject to a 15% tariff on exports.
Trump said that Japan will invest $550 billion into the U.S., of which the U.S. will “receive 90% of the Profits.”
While the 15% tariff is lower than the 25% initially outlined by Trump, it still goes against Tokyo’s earlier demands that Japan be exempt from all U.S. tariffs.
The levy is likely to take effect from August 1, when Trump’s other tariffs against major economies are set to take effect.
This deal saw the Japanese benchmark Nikkei soar over 3% to the highest level in a year, and has raised confidence that an agreement between the U.S. and the European Union can be reached before the August deadline, with representatives from the 27-member bloc going to Washington for more talks during this session.
UniCredit lifts 2025 outlook Back in Europe, the quarterly earnings season is ramping up, with a number of the region’s senior companies reporting their results.
3rd party Ad. Not an offer or recommendation by Investing.com. See disclosure here or remove ads. UniCredit (BIT:CRDI) posted a much higher than expected quarterly profit and raised its 2025 outlook, a day Italy’s second biggest bank after ditching a takeover bid for rival Banco BPM (BIT:BAMI).
French auto giant Renault (EPA:RENA) reported no growth in second-quarter sales, after a plunge in demand for vans in Europe offset growth in passenger cars.
Thales (EPA:TCFP) raised its 2025 sales growth forecast after the French defence and aerospace group posted higher first-half sales and profit amid higher military spending in Europe.
Norwegian energy group Equinor (OL:EQNR) reported a drop in second-quarter profit of 13% from a year earlier, as declining oil prices outweighed a rise in the price of gas
German software maker SAP (ETR:SAPG) reported a healthy second quarter boosted by cost cuts, but held off on increasing full-year targets as hoped by some investors.
Across the pond, investors will also be watching earnings reports later in the day from Tesla (NASDAQ:TSLA) and Google’s parent Alphabet (NASDAQ:GOOGL), two of the Magnificent 7 stocks that have driven much of the market rally due to AI optimism.
Eurozone consumer confidence release due Investors will study the release of the eurozone consumer confidence number for June later in the session, ahead of the European Central Bank’s next policy decision on Thursday.
Analysts generally expect the ECB to keep its key deposit rate steady at 2%, after the policymakers agreed to cut rates by 25 basis points last month, the eighth reduction in a year.
