European stock markets kicked off the week on a high note, buoyed by strong performances from energy giant BP, despite fresh tariff threats from US President Donald Trump. Investors saw a mixed landscape of opportunities and risks, as shifting trade policies and corporate shakeups added momentum to key sectors.
President Trump announced on Sunday that all US imports of steel and aluminium would be hit with a new 25% tariff, intensifying trade tensions. This comes in addition to previous levies, including the 10% tariff on Chinese imports, which had already provoked retaliatory measures from Beijing. The European Union is also preparing its response, with German Chancellor Olaf Scholz signalling a potential counteraction in the near future. While last week’s suspension of tariffs on Mexico and Canada briefly reassured markets, this latest escalation has reintroduced volatility and uncertainty.
Despite these trade concerns, European equities continue to perform robustly. The pan-European STOXX 600 index has recorded its strongest six-week start to a year since 2015, outpacing Wall Street. Investor confidence has been bolstered by attractive valuations, steady earnings growth, expectations of further monetary stimulus from the European Central Bank, and hints of fiscal policy adjustments in Germany. These factors have helped counterbalance broader economic uncertainties.
In corporate news, BP surged more than 6% following reports that activist investor Elliott Investment Management has taken a stake in the British energy major. While the exact size of the holding remains undisclosed, Elliott is advocating for changes aimed at enhancing shareholder value. With BP’s market capitalisation standing at approximately £69 billion ($85.62 billion), far below Shell’s £161 billion valuation, the activist investor sees significant upside potential.
Elsewhere, Finnish telecom giant Nokia saw its stock climb 2% after announcing that CEO Pekka Lundmark will step down, with Justin Hotard set to assume the role on April 1. Hotard, currently a senior executive at Intel, is expected to steer Nokia through its next phase of strategic growth.
Meanwhile, oil prices rebounded after three consecutive weeks of declines, even in the face of new US tariff measures. US crude futures (WTI) rose 1.3% to $71.94 per barrel, while Brent crude gained 1.3% to $75.65 per barrel. Both contracts had suffered losses of nearly 2% the previous week, driven by a sharp increase in US crude stockpiles and concerns over escalating trade tensions.
