Europe close: Stoxx 600 at five-week high, DAX hits new record

(Sharecast News) - European stocks rose to their highest levels in more than five weeks on Friday after the US secured a trade deal with the UK and suggested easing tariff restrictions on China.

The Stoxx 600 rose 0.4% to 537.54, with moderate gains seen across most major markets. The last time the index closed higher was on 1 April, a day before Donald Trump unleashed his tariff rampage on America's trading partners.

The DAX in Frankfurt, in particular, rose by 0.6% to a new closing high of 23,494.17.

Helping sentiment in afternoon trade were comments from Trump, who suggested that US tariffs on Chinese goods should be cut from 145% to 80%. Ahead of talks with China in Geneva this weekend, Trump wrote on his Truth Social site: "80% Tariff on China seems right! Up to Scott B," referring to treasury secretary Scott Bessent.

However, analysts at Danske Bank said in a note that "markets are expecting tariffs to land around 60%, and there are possibilities for both positive and negative surprises relative to that." They said: "Tariffs far above 100%, as they currently have against each other, are clearly going to have a seriously negative effect on both countries' economies as supply chains are disrupted and there is a risk of empty shelves in US stores.

Investors were also reacting to the relatively few details revealed in the much-hailed UK and US trade agreement. "The fact that the two countries could agree on a few points is a good start, but the UK entered the negotiations with a tariff rate of 10% and left the table with... a tariff rate of 10%," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank.

Market movers

Swiss hearing care specialist Sonova pleased the market with the release of its full-year results on Friday, with turnover beating forecasts, as investors shrugged off the news that its long-running chief executive is to leave. Shares rose 3%.

BP shares were 5% higher after a Financial Times report said Shell, Chevron, Exxon Mobil, TotalEnergies and ADNOC had run the numbers for a possible takeover of the energy giant.

Airbus shares were up slightly as British Airways owner IAG placed a large order for its jets, while the airline group was higher after surging first-quarter earnings.

Commerzbank was up 4% after the German lender posted its highest profits in 14 years during the first quarter, helped by quick growth on its top-line and a decline in credit provisions.

Danish vaccine developer Bavarian Nordic surged 6% on first-quarter results which showed that sales were up 62% on last year.