European markets are set to open higher Monday after U.S. President Donald Trump announced that proposed tariffs on Mexican imports would be suspended indefinitely.
The FTSE 100 is seen around 33 points higher at 7,365, while the DAX is expected to open up around 69 points at 12,114 and the CAC 40 is projected to climb around 18 points to 5,382.
Trump pulled back from kickstarting another trade war last week, saying in a Twitter post Sunday that he has “full confidence” that Mexico will crack down on migration from Central America, after the two neighbors reached a consensus. The New York Times reported Saturday that the deal to avert tariffs largely comprised actions Mexico had already agreed to take.
Stocks in Asia traded higher Monday on the news, Hong Kong’s Hang Seng index surging 2.03%, after official Chinese trade data for may beat forecasts and showed an overall trade surplus of $41.65 billion for the month.
U.S. Treasury Secretary Steven Mnuchin, a lead negotiator in trade talks with China, told CNBC on Sunday that Trump will decide whether to implement more tariffs on China after meeting with Chinese President XI Jinping later in June.
G-20 finance leaders on Sunday said that trade and geopolitical tensions have intensified, raising risks to improving global growth, but they stopped short of calling for a resolution of the deepening U.S.-China trade conflict.
Back in Europe, April trade, GDP and industrial data for the U.K. is expected to be released at around 9.30 a.m. BST. The U.K. has also agreed a preliminary free trade agreement (FTA) with South Korea, which seeks to maintain existing trade arrangements post-Brexit. Meanwhile, Conservative party candidates are ramping up their campaigns to replace Prime Minister Theresa May, who resigned as leader of her party on Friday.
In corporate news, Reuters reported that Fiat Chrysler and Renault are seeking ways to resuscitate their collapsed merger and secure the approval of Renault’s alliance partner Nissan.
No major earnings releases are due in Europe Monday.