As of Friday morning, European stock markets are showing modest gains despite persistent uncertainty in the global economy. Investors are weighing the implications of the latest interest rate cut by the European Central Bank and closely monitoring upcoming U.S. employment data.

Monetary policy and its impact

On June 5, the ECB lowered its key interest rate by 25 basis points, bringing it down to 2.0%. This marks the eighth cut over the past year, reflecting the central bank’s effort to stimulate economic growth amid external risks, including trade tensions with the United States. However, ECB President Christine Lagarde signaled that the easing cycle may pause, noting that the current rate level is now considered “neutral.” Markets responded cautiously: the pan-European STOXX 600 index rose by 0.2%, and the euro strengthened to a six-week high.

Key indices: performance and sentiment

As of the morning of June 6, the main European stock indices are showing the following changes:

• FTSE 100 (UK): 8,827 points (+0.29%)
• DAX (Germany): 24,377 points (+0.42%)
• CAC 40 (France): 7,843 points (+0.49%)
• STOXX 50 (eurozone): 5,429 points (+0.44%)

These moderate gains reflect cautious optimism among investors, who are awaiting U.S. employment data that could influence future policy decisions by the Federal Reserve.

The impact of global factors

Global markets remain sensitive to geopolitical developments. An escalating dispute between U.S. President Donald Trump and Tesla CEO Elon Musk led to a 14% drop in the company's shares, raising concern among investors. In addition, ongoing trade negotiations between the U.S. and China continue to inject uncertainty into the global economic outlook.

In light of the ECB’s latest decisions and anticipation of key U.S. economic data, European stock markets are demonstrating resilience. However, ongoing uncertainty in global trade and geopolitical risks demand that investors remain cautious and prepared for potential market volatility.