U.S. stock futures and European shares gained Monday after President Trump gave the European Union a temporary reprieve on new threatened tariffs.
Trump on Friday moved to increase the U.S. trade war with the EU, the U.S.’s largest trading partner , saying he planned to levy 50% tariffs starting June 1. He said that existing trade talks to avert planned, so-called reciprocal tariffs were “going nowhere.”
But on Sunday he pushed back the deadline for the new tariffs to July 9, after speaking with European Commission President Ursula von der Leyen, giving both sides more time to reach an agreement. Von der Leyen wrote on X that the EU was “ready to advance talks swiftly and decisively” to target a good deal.
Futures tied to major U.S. indexes stood roughly 1% higher as of late morning Eastern time, while the benchmark Stoxx Europe 600 index rallied similarly. Markets in the U.S. are closed Monday for the Memorial Day holiday.
“This is nothing more than the usual ‘threat and retreat’ that has been the modus operandi of this tariff tennis we have witnessed since the start of the year,” said Florian Ielpo, head of macro at Lombard Odier Investment Managers in Geneva.
Ielpo said the EU would likely push to reach a 10% “baseline” tariff agreement with the U.S., which he didn’t expect would have much impact on the bloc’s economies. He forecast that European stocks would continue to perform strongly, with investors seeing Europe as a relative haven against U.S. uncertainty.
Both U.S. and European stocks fell Friday on Trump’s threat. The S&P 500 ended the week down 2.6%.
The dollar held broadly steady Monday, after the WSJ Dollar Index settled Friday at its weakest level since September.
The British pound continued to rally, advancing about 0.2% against the dollar. It settled Friday at a little under $1.354, the strongest since early 2022. The U.K. is potentially less exposed to trade uncertainty than many other economies, after London and Washington unveiled an outline trade deal earlier this month.
Elsewhere, Japan’s Nikkei 225 rose 1%, while Hong Kong’s Hang Seng Index fell about 1.4%.
Chinese auto stocks slumped after Tesla rival BYD offered discounts for many of its models, sparking industry concerns about a price war . BYD’s shares in Hong Kong dropped 8.6%.
Gold futures fell following a rally Friday. Bitcoin recently traded at around $109,600, not far off record highs.
Trump also warned Apple on Friday that iPhones and other smartphones made overseas could face significant levies , sending Apple shares down 3%. Shares in Apple rival Samsung Electronics gained nearly 1% in South Korea on Monday despite Trump saying the tariffs would extend to “Samsung and anybody that makes that product.”
Write to Angus Berwick at angus.berwick@wsj.com
