European Stocks Mixed as Tariff Uncertainty Clouds Outlook

European stock indices inched higher on Tuesday, trimming the losses from the previous session as markets reassessed concerns that advances in AI technology will displace traditional sectors of the economy. The Eurozone's STOXX 50 inched rose 0.1% to 6,122 and the pan-European STOXX 600 added 0.3% to 630, not far from the record high touched last week. Companies with exposure to AI infrastructure booked gains ahead of Nvidia's earnings in the US and the deal between Meta and AMD, with ASML and Infineon adding 1.1% and 1.8%, respectively. Meanwhile, autos rebounded after the US placed 10% tariffs on all goods coming from Europe, below yesterday's threat of 15% levies, after its Supreme Court struck down earlier barriers. BMW, Volkswagen, and Mercedes-Benz gained more than 1%. Still, software and payment focused SAP and Adyen extended their slumps from yesterday. Also, banks closed sharply lower with Santander dropping 2.5%, while Intesa Sanpaolo and Deutsche Bank fell 1.7%.

European equities edged lower on Tuesday as US President Donald Trump’s new 10% global tariff came into force, heightening trade tensions and weighing on investor sentiment. The EURO STOXX 50 slipped 0.2% to 6,100, while the broader STOXX Europe 600 fell 0.2% to around 627 points. The tariff was enacted under an executive order signed last Friday, just hours after the US Supreme Court blocked several of the administration’s earlier import duties. According to Bloomberg, White House officials are also preparing a formal order that could raise the levy further to 15%, adding to uncertainty around global trade policy. On the economic front, fresh data showed that new car sales in the EU declined in January for the first time since June 2025, putting additional pressure on the automotive sector. Among individual stocks, Unite Group slumped 8% after the UK-listed student accommodation provider reported lower bed sales last year, reflecting softer demand from international students.

European equity markets were poised to open higher on Tuesday, recovering from the previous session’s losses as risk appetite improved, even as investors continued to evaluate AI disruption concerns, shifting US tariff policies and geopolitical tensions. Traders largely brushed aside Monday’s AI-driven selloff on Wall Street, with Asian technology shares climbing to fresh record highs. On the trade front, US President Donald Trump cautioned that countries that “play games” with existing trade agreements could face steeper duties, although major trading partners have so far maintained their current deals. Meanwhile, investors will monitor French business confidence data for February and review earnings reports from Standard Chartered, Endesa and Telefonica, among others. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures were each up about 0.2%.