European stocks mostly higher after U.S. tariffs ruling

Investing.com - European equity indices mostly rose Thursday, after President Donald Trump’s proposed reciprocal trade tariffs on major U.S. trading partners were blocked by a federal court, raising hopes that any associated economic damage will be limited.

At 04:45 ET (08:45 GMT), the DAX index in Germany climbed 0.4%, the CAC 40 in France gained 0.6%, while the FTSE 100 in the U.K. fell 0.1%. 

Tariffs ruling boosts sentiment

Sentiment received a boost Thursday after President Donald Trump’s proposed reciprocal trade tariffs on major U.S. trading partners were blocked by a federal court on Wednesday, on the grounds that the president overstepped his authority. 

The Court of International Trade ruled on Wednesday that the International Emergency Economic Powers Act, which was invoked by Trump to carry out his tariff agenda, did not grant the president sufficient authority to impose “unlimited tariffs on goods from nearly every country in the world.” 

The ruling deals a potentially serious blow to the U.S. president’s economic agenda, removing leverage as he attempts to negotiate trade deals with various nations, including with the European Union.

Nvidia’s earnings lift confidence

In the corporate sector, European AI-exposed stocks such as ASML (AS:ASML) and Schneider Electric (EPA:SCHN) soared Thursday, with overall sentiment lifted by AI bellwether Nvidia (NASDAQ:NVDA), which surpassed quarterly sales expectations after the close of trading on Wednesday.

European carmakers, such as Stellantis (NYSE:STLA), Porsche (ETR:P911_p) (ETR:PSHG_p) and Volkswagen (ETR:VOWG_p), posted strong gains, while luxury stocks, including Kering (EPA:PRTP), Christian Dior (EPA:DIOR) and Burberry (LON:BRBY), surged.

Elsewhere, British Airways chief executive Sean Doyle sold over £2 million worth of stock in International Consolidated Airlines (OTC:ICAGY), while Auto Trader (LON:AUTOA) reported a 12% rise in basic earnings per share, returning over £275 million to shareholders through buybacks and dividends during the year.

Crude stable ahead of OPEC+ meeting

Oil prices soared Thursday, with sentiment boosted after a U.S. court ruled that President Donald Trump could not proceed with his plans for reciprocal trade tariffs. 

At 04:45 ET, Brent futures climbed 1% to $64.97 a barrel, and U.S. West Texas Intermediate crude futures rose 1.2% to $62.56 a barrel.

The court ruling boosted risk appetite, as Trump’s tariff plans have been the biggest point of uncertainty for oil markets this year, as traders fretted over their economic impact and their effect on oil demand.

That said, Wednesday’s court ruling added another layer of uncertainty, given that the White House is set to appeal the decision. 

Adding to the positive news was data from the American Petroleum Institute showing that U.S. oil inventories shrank by 4.24 million barrels in the past week, in contrast to expectations for a build of 1 million barrels. 

Signs of a sharp drawdown in U.S. oil stockpiles sparked hopes that fuel demand in the country remained strong despite heightened economic uncertainty, and traders will look for confirmation from official data later in the session.