European shares surged on Monday, poised to recoup the previous session’s losses on relief after US President Donald Trump delayed his threat to impose a 50% tariff on the European Union.

The pan-European STOXX 600 index rose 1% by 0710 GMT. The benchmark lost 0.9% on Friday after Trump unexpectedly called for sharp tariffs on goods from the EU, saying that negotiations with the region were not moving fast enough.

Trump announced extension on Truth Social

On Sunday, Trump extended the deadline for tariffs to July 9 from June 1, as he agreed after European Commission President Ursula von der Leyen told him that the 27-nation bloc needed more time to produce a deal.

“I received a call today from Ursula von der Leyen, President of the European Commission, requesting an extension on the June 1st deadline on the 50% Tariff with respect to Trade and the European Union. I agreed to the extension — July 9, 2025 — It was my privilege to do so. The Commission President said that talks will begin rapidly. Thank you for your attention to this matter!” Trump wrote on his Truth Social account.

European Commission President Ursula von der Leyen also commented on social media, saying she had a good conversation with President Trump and emphasised that the EU and US share the world’s most consequential and close trade relationship.

Automobiles and other stocks

The automobiles and parts index, sensitive to tariff-related pressures, rebounded by 1.4%. Mercedes gained 2.1%, BMW rose 2%, and Volkswagen advanced 1.9%.

Luxury stocks, highly exposed to the U.S. market, gained. Shares of Kering, LVMH and Richemont rose between 1.5% and 2.4%.

Economically sensitive banks surged 1.5%, while technology stocks led gains among sectors, rising 1.9%.

Trading volumes were light on Monday due to public holidays in the U.S. and the UK markets. However, U.S. stock futures were up more than 1%.

Meanwhile, the week is inundated with key data from the region, with specific attention on euro zone economic sentiment, alongside German unemployment and inflation figures for May.