European stocks rose on Thursday after U.S. judges blocked President Donald Trump’s proposed tariffs, causing shifts in global markets. The White House is likely to navigate around a U.S. court ruling that blocked the steep reciprocal tariffs imposed by President Donald Trump in April, according to Goldman Sachs. The Court of International Trade’s (CIT) decision represents a significant setback for Trump’s tariff plans but might not change the final outcome, said Goldman’s chief economist, Jan Hatzius.
Despite the administration’s plans facing uncertainty, Trump could still use executive power under Section 301 of the Trade Act of 1974 to reimpose tariffs. This was the basis of Trump’s tariffs on China during his first term. “It seems unlikely that the administration could win an appeal in the 10 days it has under the CIT order to remove the tariffs.
We would expect the White House to announce a similar across-the-board tariff using Sec. 122,” Hatzius added. Section 122 allows the White House to impose import tariffs of up to 15% for up to 150 days on nations with “large and serious” trade surpluses with the U.S.
The U.S. dollar index — which measures the greenback against a basket of major rivals — rose by 0.2% following the court’s decision.
The euro and the British pound were 0.2% and 0.1% lower against the dollar, respectively.
European stocks gain amidst tariff block
Twenty minutes after the opening bell in Europe, stocks climbed as investors reacted to the U.S. Court of International Trade’s decision.
The pan-European Stoxx 600 was trading 0.4% higher, with tech, mining, and autos stocks leading the gains. Several European countries, including France, Belgium, Germany, Norway, the Netherlands, and Switzerland, are observing Ascension Day today, with most major markets remaining open for trade. German defense firm Renk is looking to recruit talent from the struggling auto sector to fuel growth amid rising geopolitical tensions and increased military spending.
Germany recently passed legislation enabling a steep increase in defense spending, and Renk has seen its share price rise over 300% this year, with its order book growing by 164% in the first quarter. European shares are not alone in climbing following the U.S. court’s ruling. Stocks in the Asia-Pacific region and U.S. stock futures also experienced gains as investors reacted positively to the blow to Trump’s tariffs plan.
Futures tied to major European indices indicated a positive open ahead of Thursday’s trading session. Futures for Germany’s DAX index were up 1.2%, while FTSE 100 futures rose 0.8%, and CAC 40 futures increased by 0.2%. Pan-European Stoxx 600 futures jumped 1.3%.
