London: European stocks closed higher Wednesday as investors are waiting for updates on a potential trade deal with the US. The pan-European Stoxx 600 index rose 0.78%, or 4.25 points, to close at 549.96. Germany's DAX 40 index was up 1.42% to end at 24,549.56, and Britain's FTSE 100 added 0.15% to 8,867.02 points. France's CAC 40 rose 1.44% to 7,878.46, and Italy's FTSE MIB index climbed 1.59% to close at 40,821.31.

According to Anadolu Agency, investors are awaiting an announcement of a trade deal between the US and the EU as US President Donald Trump extended a tariff deadline Monday to August 1. The US president also sent tariff letters to 21 countries in two days, imposing tariffs from 20% to 40%. Trump stated that the EU has changed its tone, expressing optimism about the ongoing negotiations. "They treated us very badly until recently. Now they're treating us very nicely. It's like a different world," Trump remarked. He added, "We're probably two days off from sending them a letter. We are talking to them. I just want you to know a letter means a (tariff) deal."

EU Commission President Ursula von der Leyen, meanwhile, addressed the European Parliament on Wednesday, emphasizing the EU's commitment to its principles. "We stick to our principles, we defend our interests, we continue to work in good faith, and we get ready for all scenarios," she stated.

On another note, German Chancellor Friedrich Merz expressed a cautiously optimistic outlook on reaching an agreement in the coming days, highlighting its significance for Germany's export-driven economy. "This is primarily in the interest of our export-oriented economy," Merz noted.

In related business news, German pharmaceutical firm Merck announced on Wednesday its agreement to acquire UK-based Verona Pharma for $10 billion, or $107 per share, aiming to expand its portfolio of lung disease medications.