European Markets Rally Amid Hopes of Softer U.S. Tariffs

European shares rise due to optimism regarding U.S. tariffs, following a robust Wall Street rally. Investors focus on potential reciprocal U.S. tariffs, with concerns also reflected in oil prices. U.S. economic indicators suggest recovery, impacting the dollar and global market dynamics.

European shares experienced a rise on Tuesday, spurred by a strong overnight rally on Wall Street driven by optimism about less severe U.S. tariffs than initially feared. The broad Stoxx 600 index climbed 0.6% early in the trading session, with most European benchmarks and sectors remaining in cautious positive territory.

Key focus for investors remained the looming reciprocal tariffs announced by U.S. President Donald Trump. While automobile tariffs were indicated as forthcoming, President Trump suggested that not all tariffs would be enforced by April 2, with some countries potentially receiving exemptions. This sparked a 'risk-on' reaction on Wall Street, propelling the S&P 500 to its highest close in over two weeks and lifting the Nasdaq by more than 2% thanks to a tech stock surge.

Tariffs and their impact were also evident in the oil market, with oil prices rising for the fifth consecutive day. Concerns arose after Trump imposed a 25% tariff on countries purchasing oil or gas from Venezuela. In response, Brent futures increased by 44 cents to $73.43 a barrel, and U.S. crude rose by 38 cents to $69.49, with both benchmarks gaining over 1% by Monday.

(With inputs from agencies.)