European stocks experienced a notable upswing on Thursday for the first time in five trading sessions. Both the STOXX 50 and the STOXX 600 indices increased by 1.2%. This positive movement followed the announcement by US President Trump that he would delay the imposition of new tariffs on several European countries, citing the establishment of a "framework agreement" concerning Greenland. This announcement came on the heels of a meeting with the NATO Secretary General, though specific details of the accord were not disclosed.
Earlier, during the Davos meeting, President Trump assured that there would be no forceful takeover of Greenland. In response to his previous threats, the European Parliament halted the ratification of the EU–US trade deal, initially agreed upon in July.
The stock rally was driven primarily by gains in luxury and automotive sectors, with LVMH climbing 1.9%, Hermès advancing 2.3%, Mercedes-Benz rising 3%, and Porsche ascending 3.7%. Notably, Volkswagen saw a significant surge of over 5%, attributed to a reported 20% year-on-year increase in cash flow. Conversely, shares in the defense sector experienced declines, with Rheinmetall down 2.4% and Leonardo shedding 2%.
