EU equities climb as investors eye German business sentiment boost
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European shares opened higher on Tuesday, buoyed by optimism that Germany’s historic fiscal stimulus may be starting to lift sentiment across the region. With a closely watched business survey from the Ifo Institute on deck, markets appear increasingly confident that Europe’s largest economy is gaining traction.
The STOXX Europe 600 index rose 0.3% by 08:15 GMT, with broad-based sector gains led by financials and energy. Expectations are centered on a modest improvement in Germany’s March business climate index, forecast to rise to 86.7 from 85.2 the previous month. The anticipated uptick would mark a shift in sentiment following Berlin’s multi-billion-euro commitment to infrastructure and defense spending — a fiscal pivot that has led to upward revisions for euro area growth.
So far in 2025, European equities have outperformed their U.S. peers, supported by renewed capital flows and improving macro fundamentals. However, market participants remain attuned to global trade dynamics. U.S. President Donald Trump reiterated Monday that not all reciprocal tariffs set for April 2 would take effect, with potential exemptions for certain countries. The news sparked a modest rotation into underperforming U.S. stocks, while European indices ended the previous session largely unchanged.
Stock-specific moves added to the morning’s divergence. Swiss logistics firm Kuehne + Nagel dropped 2.7% after warning that full-year operating profit may fall short of expectations due to persistent global economic headwinds. In contrast, shares of German lubricant manufacturer Fuchs Petrolub gained 5.4%, outperforming the broader index after reporting stronger-than-expected results.
With the Ifo data due shortly, investors are watching for confirmation that fiscal tailwinds are translating into improved corporate confidence. Any positive surprise could further underpin the recent resilience of European markets, particularly amid signs of stabilizing demand and constructive policy support.
The STOXX Europe 600 index rose 0.3% by 08:15 GMT, with broad-based sector gains led by financials and energy. Expectations are centered on a modest improvement in Germany’s March business climate index, forecast to rise to 86.7 from 85.2 the previous month. The anticipated uptick would mark a shift in sentiment following Berlin’s multi-billion-euro commitment to infrastructure and defense spending — a fiscal pivot that has led to upward revisions for euro area growth.
So far in 2025, European equities have outperformed their U.S. peers, supported by renewed capital flows and improving macro fundamentals. However, market participants remain attuned to global trade dynamics. U.S. President Donald Trump reiterated Monday that not all reciprocal tariffs set for April 2 would take effect, with potential exemptions for certain countries. The news sparked a modest rotation into underperforming U.S. stocks, while European indices ended the previous session largely unchanged.
Stock-specific moves added to the morning’s divergence. Swiss logistics firm Kuehne + Nagel dropped 2.7% after warning that full-year operating profit may fall short of expectations due to persistent global economic headwinds. In contrast, shares of German lubricant manufacturer Fuchs Petrolub gained 5.4%, outperforming the broader index after reporting stronger-than-expected results.
With the Ifo data due shortly, investors are watching for confirmation that fiscal tailwinds are translating into improved corporate confidence. Any positive surprise could further underpin the recent resilience of European markets, particularly amid signs of stabilizing demand and constructive policy support.