European shares close higher on hopes of softer U.S. tariffs; Bayer regains 5%

European markets closed higher on Tuesday as investors continued to assess the scope and breadth of U.S. President Donald Trump’s trade tariffs.

The pan-European Stoxx 600 index provisionally closed 0.72% higher, with most sectors and all major bourses in positive territory.

Germany’s DAX led regional gains, up 1.1%, as biotech giant Bayer rose nearly 5%. The company is recovering from a 7% loss in the previous session after announcing over the weekend that it had been ordered by a U.S. court to pay $2.1 billion in damages relating to its Roundup weed killer.

German software giant SAP meanwhile extended its newly-held position as Europe’s most valuable company, up 1.5%. The company on Monday overtook Denmark’s Novo Nordisk in market capitalization, as investors bet on its ability to boost revenue amid the AI boom.

Elsewhere, British oil major Shell gained 1.67% after announcing plans to boost investor returns, cut spending and double down on its liquified natural gas (LNG) push.