SummaryCompaniesDefence stocks lead sectoral gains on STOXX 600Thyssenkrupp rises after report of shareholder meeting plansSTOXX 600 up 0.9% May 26 (Reuters) - European shares rose sharply on Monday, poised to recoup the previous session's losses on relief after U.S. President Donald Trump delayed his threat to impose a 50% tariff on the region. The pan-European STOXX 600 index (.STOXX), opens new tab rose 0.9%, as of 0822 GMT. The benchmark lost 0.9% on Friday after Trump unexpectedly called for sharp tariffs on goods from the European Union, saying that negotiations with the region were not moving fast enough. Advertisement · Scroll to continue On Sunday, Trump extended the deadline for tariffs to July 9 from June 1, after European Commission President Ursula von der Leyen said the 27-nation bloc needed more time to produce a deal. The automobiles and parts index (.SXAP), opens new tab, sensitive to tariff-related pressures, rebounded by 1.1%. Stellantis (STLAM.MI), opens new tab gained 2.5%, Mercedes (MBGn.DE), opens new tab rose 1.9% and Valeo jumped 4.9%. Luxury stocks, highly exposed to the U.S. market, gained. Shares of Kering (PRTP.PA), opens new tab, LVMH (LVMH.PA), opens new tab and Richemont (CFR.S), opens new tab rose between 0.9% and 1.4%. Economically-sensitive banks (.SX7E), opens new tab surged 1.2%, while technology stocks (.SX8P), opens new tab rose 1.7%. The European aerospace and defence index (.SXPARO), opens new tab led the sector gains, advancing 1.8%. Advertisement · Scroll to continue "One thing is for sure, whatever is said has to be taken with a pinch of salt because the narrative changes so fast. So whatever is true right now may not be true in about 10 minutes," said Ipek Ozkardeskaya, a senior market analyst at Swissquote Bank. The euro jumped along with other risk-sensitive currencies, as Trump backtracked from his tariff threats, while the dollar extended its fall against a basket of currencies. Rising concerns about the U.S. economic slowdown and fiscal woes, underscored by Moody's credit rating downgrade on May 16, are increasingly persuading investors to limit their exposure to U.S. assets. "There was this very deep and very historically anchored sentiment among investors that if you want to have a low-risk portfolio, a low-risk investment, the U.S. is where you would go first," Ozkardeskaya added. Ad Break Coming Up NEXT StayNext OffEnglish 180p288p360p480p540p576p720pHD1080pHDAuto (180p) About ConnatixV584889 About ConnatixV584889 Continue watchingafter the adVisit Advertiser websiteGO TO PAGE "But with the trade tensions and geopolitical tensions, this favorable sentiment towards the U.S. assets has shifted." Trading volumes were lighter than usual due to public holidays in the U.S. and the UK markets. However, U.S. stock futures were up more than 1.3%. Thyssenkrupp (TKAG.DE), opens new tab jumped 6.7% after a weekend report said the submarine and car parts maker plans to hold a shareholder meeting on August 8 to approve an expected spin-off of its warship division. Meanwhile, remarks from ECB President Christine Lagarde will be closely monitored later in the day, apart from key data from the region this week. Reporting by Nikhil Sharma; Editing by Rashmi Aich Purchase Licensing Rights