Europe close: Stocks rally at the start of Q2
By Alexander Bueso
Date: Tuesday 01 Apr 2025
(Sharecast News) - European shares rallied on the first day of the second quarter, lifted by a fall in eurozone inflation and an encouraging survey indicating the bloc's manufacturing sector was showing signs of recovery.
The pan-regional Stoxx 600 index was up 1.07% to 539.64, alongside a 1.70% jump for Germany's DAX to 22,539.98, whilst France's CAC-40 added 1.10% to 7,876.36.
A scheduled announcement on reciprocal trade tariffs by the White House on 2 April was not far from investors' minds however.
Despite the rebound, gold hit a new high of $3,177 per ounce before retreating, as investors kept one eye on safe havens.
Stephen Innes managing partner at SPI Asset Management said April 2nd was "shaping up as one of the more layered market riddles in recent memory".
"The tariff rhetoric has reached full crescendo-deafening in volume, yet maddeningly vague in detail. Markets are flush with speculation, but real pricing clarity is missing in action, and the uncertainty premium is sky-high."
"Meanwhile, the Trump administration appears to be in its own state of flux-scrambling behind the scenes to finalize tomorrow's 'Liberation Day' tariff rollout. The internal tug-of-war? Whether to apply bespoke tariff rates for each trading partner (a softer, more nuanced approach) or unleash a campaign-era sledgehammer with broad-based across-the-board tariffs."
In economic news, sharp falls in energy costs and slowing price growth for services saw the eurozone inflation rate ease to a four-month low in March, according to data from Eurostat, while the unemployment rate declined to a new low.
The headline consumer price index for the single-currency region rose by 2.2% year-on-year last month, down from 2.3% in February and 2.5% in January.
This was the lowest rate of price growth since November and was in line with the consensus forecast.
Meanwhile, manufacturing in the eurozone showed signs of pulling out of its long-running slump last month, although US tariffs posed a new threat, according to a survey published on Tuesday,
A final reading of HCOB's final purchasing managers' index for the sector hit 48.6 in March, a touch below a flash estimate of 48.7, but its highest level for more than two years and close to the 50 mark separating growth from contraction.
The output Index jumped into expansion territory at 50.5 from Feb: 48.9 - a 34-month high.
In equity news, shares in UK building supplier Travis Perkins tanked on slumping profits and a dividend cut.
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