European defense stocks hit record high; Germany's Renk jumps 5%

Defense stocks touch record high

The European Stoxx Aerospace and Defense index rose to a new record high this morning, following a gain of around 1.1%.

So far this year, the index has surged more than 53%.

Top performers in the sector on Wednesday include Germany's Renk, which jumped 5.3% after Bloomberg reported the military vehicle parts maker was considering expanding to offer a civilian business. Poland's Lubawa was last seen trading 3% higher, while Airbus was up by 1.2%.

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Banking stocks hit 17-year high

The Stoxx Europe 600 Banks index has risen to its highest level since 2008 this morning, after a gain of 1.4% so far today.

Top gainers in the banking sector include Societe Generale, last seen 3.7% higher, Banco Sabadell, up 2.8%, and Deutsche Bank, which has gained 2.3%.

Read more on European banking stocks' outperformance this year.

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European shares open higher

It's around 30 minutes since European markets opened, and regional stocks are edging higher.

The pan-European Stoxx 600 was last seen trading up by 0.1%, with all major bourses in positive territory.

The French CAC 40 and Germany's DAX have both gained 0.4%, while London's FTSE 100 is 0.1% higher.

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Whats the latest on tariffs?

Here's a roundup of the trade policy updates that have come from the White House so far this week.

New duties on 14 countries: On Monday, U.S. President Donald Trump extended his “reciprocal tariffs” deadline to Aug. 1, but announced new tariff rates of 25% to 40% on 14 trading partners. The affected countries are Japan, South Korea, Malaysia, Kazakhstan, South Africa, Laos, Myanmar, Bosnia and Herzegovina, Tunisia, Indonesia, Bangladesh, Serbia, Cambodia and Thailand.

Tariffs on copper: “Today, we're doing copper,” Trump said during a Tuesday Cabinet meeting at the White House. Without giving details on when the duties on the metal would take effect, Trump said the new tariff on copper would be 50%.

Threatened tariffs on pharmaceuticals: At the same Cabinet meeting, Trump also reiterated his previous threat to impose sector-specific tariffs on pharmaceutical goods. The sector would face “a very, very high rate, like 200%,” the president said.

No news on the EU: No new tariffs targeting the European Union have been announced, with many seeing the lack of a letter from the Trump administration to the bloc as a sign that a trade agreement will be struck before the looming deadline. An EU diplomat told CNBC on Monday that any framework deal is likely to include a 10% baseline tariff and may see certain goods — such as aircraft and spirits — given exceptions. It was also widely reported earlier this week that European Commission President Ursula von der Leyen had a “good exchange” with Trump over the weekend.

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Here are the opening calls

Good morning from London and welcome to CNBC's live blog covering all the action and business news in European financial markets on Wednesday.

Futures data from IG suggests regional markets will open in mixed territory, with London's FTSE 100 expected to open 0.2% higher, Germany's DAX 0.1% higher and France's CAC 40 up 0.5%higher. Futures tied to Italy's FTSE MIB were flat this morning.

Global markets have been seesawing this week, as traders digest the latest trade tariff news. Overnight, Asia-Pacific markets were mixed, while U.S. futures were little changed, after U.S. President Donald Trump ruled out a deadline extension on steep tariffs on 14 countries that are due take effect on Aug. 1.

Trump on Tuesday also announced a 50% levy on copper imports and signaled that more sector-specific tariffs will come soon. He also threatened to impose tariffs of up to 200% on pharmaceutical exports into the U.S., but said that he will “give people about a year, year and a half” until the duties go into effect.

What to look out for on Wednesday

Markets will be keeping an eye on comments from the OPEC seminar in Vienna on Wednesday, as well as all the latest tech news from the RAISE Summit in Paris, where the outlook for artificial intelligence is a key focus.

Traders are also assessing the likelihood of more trade deals between the U.S. and partners as the initial deadline for reduced tariffs, Wednesday, is reached. The U.S. has already sent 14 countries “letters” telling them what trade duties they will be hit with on a later date, Aug. 1.

Investors in Europe are awaiting a U.S.-EU trade deal, with speculation that an agreement could be imminent.

There are no major earnings or data releases Wednesday.