European Stocks Lack Direction, Trade Developments Eyed

Both the STOXX 50 and STOXX 600 hovered around the flatline on Tuesday, as investors continued to monitor global trade developments. According to Politico, the US has proposed a deal to the EU that would maintain a 10% baseline tariff on all EU goods, with some exceptions for sensitive sectors such as aircraft and spirits. However, Washington has given no indication that it will exempt politically sensitive industries—such as automobiles, steel, aluminum, and pharmaceuticals—as requested by the EU. Meanwhile, President Trump began issuing formal tariff notifications on Monday, starting with South Korea and Japan, both of which will face a 25% tariff beginning August 1st. On the corporate front, shares of wine and spirits producer Pernod Ricard rose about 1.8%, while Davide Campari Milano gained 1.6%. Among the largest companies, performance was mixed: SAP edged up 0.1%, and LVMH traded near the flatline. In contrast, Nestlé, Hermès, ASML Holding, and Novo Nordisk all slipped 0.3%.