European markets choppy amid hopes for EU-U.S. trade agreement

Europe stocks open higher

European sectors are mixed Tuesday morning, though stocks are generally moving higher despite trade uncertainty hanging over the region.

The Stoxx 600 index is up 0.05% shortly after the open, with Germany's DAX up 0.15% and France's CAC 40 and the U.K.'s FTSE 100 both just above the flatline.

Retail is among the worst performers, down 0.3%, while mining stocks are 0.5% higher.

We expect U.S. effective tariff rate near 20%, economist says

A lot remains unclear about the future of U.S. President Donald Trump's tariffs after 14 countries, mainly in Asia, were threatened with sharply higher rates from Aug. 1.

For European markets, all eyes remain on whether the EU will reach a framework agreement for a deal with the White House in the coming days. An EU diplomat, who did not want to be named because of the sensitivity of the talks, told CNBC's Silvia Amaro on Monday that the bloc is not expected to receive a letter from the U.S. administration detailing a new timeline for higher rates on Tuesday, providing more breathing room for negotiations this week.

The framework agreement is likely to include a 10% baseline tariff rate and may have exemptions for goods such as aircraft and spirits, they added.

According to Raphael Olsyzna-Marzys, international economist at J. Safra Sarasin Sustainable Asset Management, forecasting amid the current unpredictability is a challenge — but he said he now expects the U.S. to end up with an effective tariff rate closer to 20%, up from 15% today and 2.5% at the end of last year.

“What's clear is that Trump wants to have tariffs of 10%, that was always the bare minimum ... but what's quite clear is at least on Asian countries such as Vietnam, the tariff rate is going to be quite high because the administration feels these countries have too high of a trade surplus, they need to be corrected,” he told CNBC's “Squawk Box Europe.”

“If you negotiate, if you give everything away, you might get 20%, which is still pretty high ... We know for the EU it's going to be 10% minimum, with carve-outs and exemptions.”

Here are the opening calls

Welcome to CNBC's live blog covering all the action and business news in European financial markets on Tuesday.

Futures data from IG suggests regional markets will open lower, with London's FTSE 100 expected to open 0.3% lower, Germany's DAX and France's CAC 40 0.1% lower, respectively. Futures tied to Italy's FTSE MIB, were around 0.1% lower this morning.

Global markets are seesawing this week, as traders digest the latest trade tariff news, and any potential trade deals ahead of a July 9 deadline, when higher trade duties are due to come into effect.

U.S. Treasury Secretary Scott Bessent told CNBC's “Squawk Box” on Monday that there would be several trade announcements over the next 48 hours, adding that he expects “it's going to be a busy couple of days.” He did not specify which countries were involved.

Asia-Pacific markets swung between gains and losses overnight, however, as investors assessed Trump's latest tariff threats on 14 trading partners.

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Trump announces steep tariffs on 14 countries starting Aug. 1

Goods exported to the U.S. from Japan, South Korea, Malaysia, Kazakhstan and Tunisia are among the countries now set to face 25% tariffs starting Aug. 1, according to the letters Trump posted on Truth Social, and other countries look to have higher duties imposed on them.