European shares close higher but trade uncertainty lingers

Published Wed, Feb 25, 2026 · 05:54 AM

EUROPEAN shares rose against a backdrop of broader market gains on Tuesday, tracking increased risk appetite on Wall Street, although investors awaited clarity on US trade policy after last week’s strike down of President Donald Trump’s tariffs.

The pan-European Stoxx 600 index reversed earlier declines to close 0.2 per cent higher at 629.14 points, close to the record high hit on Friday.

Base metal miners rose the most, rising 1.5 per cent as copper prices hit an over one-week high. Consumer staples stocks and utilities followed.

Chip-related stocks rose after US peer Advanced Micro Devices’ deal with Meta Platforms to sell up to US$60 billion worth of AI chips, and tie-ups between software companies and AI lab Anthropic to develop new tools revived interest in the sector.

In Europe ASML and Infineon both rose more than 1 per cent, while the wider sector was 0.7 per cent higher.

Winners and losers as skills transferred

“Disruptive technology is about a transfer of skills and produces winners and losers rather being an outright negative,” said Mohit Kumar, an economist at Jefferies. “This year will be a lot about choosing winners and losers in the investment portfolio. We are not yet ready to step in and fade the AI-disrupted sectors.”

Most sectors on the Stoxx 600 ended the session higher, although financials and media stocks did not.

Banks fell 1.3 per cent, on renewed concerns that newer AI models could disrupt traditional businesses. Financial services companies lost 0.3 per cent.

Meanwhile, trade uncertainty persisted as Trump’s new blanket tariff rate took effect after his earlier tariffs were deemed unconstitutional. The new rate has raised questions about trade deals struck last year. The European Parliament on Monday postponed for a second time a vote on the trade agreement signed with the US.

Analysts pointed to a bearish analysis from Citrini Research on the possible risks to the global economy and the broader financial sector. The auto sector has been at the forefront of discussion on the impact of tariffs, but the broader auto sector gained 1.9 per cent on Tuesday.

Among individual stocks, Forvia climbed 2.8 per cent after the car parts supplier forecast higher operating margin of between 6 per cent and 6.5 per cent in 2026.

French vouchers and benefit cards provider Edenred was another strong performer. It added 3.9 per cent after reporting 2025 core earnings above market expectations, citing rising sales and initial benefits from its cost-cutting and efficiency plan.

Unite Group bottomed the Stoxx 600 with an over 14 per cent loss after Britain’s largest student housing provider said its annual income could fall by up to 13 per cent in 2026.

Engine maker MTU Aero Engines lost 6 per cent after forecasting 2026 results broadly in line with analyst expectations, as it navigates the fallout from partner Pratt & Whitney’s warning on defective engine components last year. REUTERS