Europe close: Stocks hit four-week high despite trade uncertainty

(Sharecast News) - European stocks rose strongly for the third straight day on Wednesday, sending the Stoxx 600 to its highest level in four weeks, as hopes of an EU-US trade deal lifted sentiment.

The Stoxx 600 finished 0.8% higher at 549.96, with a tepid gain of 0.2% in London was countered by jumps of 1.2% or more across Frankfurt, Paris, Milan and Madrid.

The pan-European benchmark index has now gained 1.6% over the past three sessions to finish at its highest close since 11 June.

European leaders are hoping to reach a trade deal with the US and may receive notification of Donald Trump's tariff plan for the bloc this week, according to the latest reports.

Investors were largely shrugging off comments from Bundesbank president Joachim Nagel, who warned the European Central Bank that maintaining price stability would be "a challenging task" amid such trade and geopolitical uncertainty. "We need to be prepared for price developments to become more volatile in general. I am afraid that heightened uncertainty will become the new normal," he said.

"The boy who cried tariffs continues to warble his perplexing ballad of random numbers from the White House, this time threatening to impose 50% tariffs on copper and 200% tariffs on pharmaceuticals," said AJ Bell's head of financial analysis Danni Hewson.

"Investors are listening, and nodding to acknowledge the latest verse, but largely getting on with business as usual. Most are probably waiting for the wolf to actually show up before properly evaluating the danger."

Meanwhile, copper prices soared on Wednesday after Trump threatened to impose tariffs of 50% on the industrial metal, higher than the 25% the market had been expecting. Commerce secretary Howard Lutnick later said in a CNBC interview that he expected tariffs to be put in place by the end of July or early August.

US Comex futures soared by a record 13% in New York on Tuesday, though prices eased on the London Metal Exchange on concerns that tariffs would weigh heavily on global demand and reduce consumption in the US.

Market movers

German car giant Volkswagen rose after seeing deliveries tick higher in the first half of the year, despite a slide in sales to the US. The company said it delivered 4.41m vehicles worldwide during the six months to June end, up 1.3% on the previous year.

London-listed mining stocks such as Antofagasta, Glencore and Anglo American were all sharply lower on the Trump tariff threat, limiting upside on the FTSE 100.

Meanwhile, pharmaceutical companies including Zealand Pharma and Novo Nordisk were also out of favour as Trump warned that he had the pharmaceutical industry in his sights, facing levies of "200%".

Meanwhile, shares in London-listed WPP slumped 16% as the advertising agency slashed annual profit forecasts as failed to win new clients amid a weakening economic outlook and the growing threat from artificial intelligence.