Europe: Shares eke out gains as trade fueled rally fades

[FRANKFURT] European shares edged higher in early trading on Tuesday, following a rally from the previous session, but Washington's tariff threats on US$4 billion of additional EU goods kept gains in check.

Days after reaching a truce in the US-China trade war, the US government on Monday ratcheted up pressure on Europe in a long-running dispute over aircraft subsidies.

Planemaker Airbus dropped 1 per cent and pressured France's CAC 40 index, which underperformed the pan-European STOXX 600 index's 0.2 per cent gain by 0715 GMT.

The US Trade Representative's office released a list of additional products - including olives, Italian cheese and Scotch whiskey - that could be hit with tariffs, on top of products worth US$21 billion that were announced in April.

Financials rose 0.4 per cent and was the biggest boost to markets, as shares of HSBC Holdings rose 0.4 per cent and Prudential Plc climbed 1 per cent.

REUTERS