European shares climb as US-Japan deal sparks EU optimism

European shares rebounded sharply on Wednesday, led by automobile shares, after US President Donald Trump signalled progress towards a potential trade agreement with the European Union following a major deal with Japan.

The pan-European STOXX 600 index climbed 1.44 per cent by 9:43 a.m. GMT. Germany’s DAX rose 1.00 per cent, France’s CAC 40 gained 1.47 per cent, Spain’s IBEX 35 was up 1.23 per cent, and the UK’s FTSE 100 advanced 0.57 per cent.

Market sentiment was lifted after Trump announced a $550 billion trade and investment deal with Japan that slashed tariffs on auto exports to the US from 25 per cent to 15 per cent. The agreement eased fears of further levies on Japanese goods and sparked optimism that a similar arrangement could be reached with the EU.

Trump said EU officials would begin trade talks in Washington on Wednesday, boosting expectations of a breakthrough in transatlantic trade tensions.

Attribution: Amwal Al Ghad English, Reuters

Subediting: M. S. Salama