European shares rose on Friday as investors assessed signs of easing trade tensions between the United States and China, lifting hopes of further trade deals before the deadline for U.S. tariff pause is lifted in July.
The pan-European STOXX 600 index advanced 0.6% at 540.67 points, as of 0707 GMT. The index was on track to log its first weekly gain in three weeks. Other major regional indexes also traded higher.
A White House official said on Thursday that the U.S. reached an agreement with China on how to expedite rare earths shipments to the United States.
With worries about tensions in the Middle East taking a backseat for now, investor focus is on signs of progress on new trade deals before a respite on higher tariffs threatened by U.S. President Donald Trump expires in early July.
EU leaders discussed new proposals from the U.S. on a trade deal at a summit in Brussels on Thursday. Commission President Ursula von der Leyen did not ruling out the likelihood of tariff talks failing, saying "all options remain on the table".
European auto stocks led sectoral gains with a 1.5% climb. Media shares advanced 1.2%.
German sportswear makers Puma and Adidas gained 4.3% and 2.9% respectively, after U.S. peer Nike's first-quarter revenue outlook exceeded market expectations.
In U.S., investors await the release of the core PCE price index due later in the day.
(Reporting by Sukriti Gupta and Sanchayaita Roy in Bengaluru; Editing by Janane Venkatraman)
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