European stocks close higher after EU threatens US with tariffs; Renault briefly pops 8%

  • The pan-European Stoxx 600 closed provisionally 0.36 percent higher Wednesday, with most sectors and major bourses in positive territory.
  • The European Union outlined a three-pronged response to proposed metals tariffs from Trump's administration.
  • Renault shot up by as much as 8 percent after a report said it was in talks with Nissan to sell most of the French government's stake in the car-maker to its Japanese alliance partner.

European stocks closed provisionally slightly higher Wednesday, as the resignation of President Donald Trump's economic advisor and the European Union's threat of tariffs on U.S. goods heightened fears of a global trade war.

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The pan-European Stoxx 600 closed provisionally 0.36 percent higher Wednesday, with most sectors and major bourses in positive territory.

Europe's auto stocks were among the best performers, up 0.6 percent. Renault shot up by 8 percent after Reuters reported that it was in talks with Nissan to sell most of the French government's stake in the car-maker to its Japanese alliance partner. The stock later pared those gains as traders pointed to a denial of the plans by the Renault-Nissan-Mitsubishi alliance. The auto sector was rattled recently after Trump threatened a levy on imports of European cars.

Basic resources, meanwhile, were down 0.2 percent, amid concerns the Trump administration will proceed with protectionist tariffs on steel and aluminum imports. Fresnillo, Randgold Resources and Hydro were the worst performers of the sector.

Looking at individual stocks, Rolls-Royce surged to the top of the European benchmark after the firm said it remained on course to meet its financial goals for 2020. The British engine-maker reported better-than-expected operating profit for 2017, sending shares more than 11 percent higher.

Cohn resigns

On Wall Street, stocks traded lower on the back of Gary Cohn's resignation from the White House.

Cohn, Trump's top economic advisor and the former president of Goldman Sachs, announced Tuesday that he would resign following disagreement with Trump over plans to slap tariffs on steel and aluminum imports. Cohn was seen as a voice of reason in the White House and well-liked by Wall Street.

The European Union outlined a three-pronged response to proposed metals tariffs from Trump's administration Wednesday, including items such as peanut butter, cranberries and orange juice that could see higher charges in Europe.

Speaking at a press conference in Brussels, Cecilia Malmstrom, the EU's commissioner for trade, said the institution would take the case to the World Trade Organization and would coordinate its actions with other trade partners that are also against the proposed tariffs from the U.S.

In the U.K., Saudi Crown Prince Mohammed bin Salman is to begin a three-day state visit to London. He will meet U.K. Prime Minister Theresa May, Foreign Secretary Boris Johnson and senior royals at Windsor Castle. Protests against his visit are planned.

Meanwhile, a political stalemate continues in Italy as parties vie for the leadership of a governing coalition after Sunday's inconclusive election. The leader of Italy's far-right Lega – the largest party within a center-right coalition in last week's vote – has said that he is the only option for prime minister. Former Prime Minister Silvio Berlusconi has put his name forward as the "coordinator of the center-right" coalition, according to Reuters.

— CNBC's Silvia Amaro contributed to this report.