Europe’s STOXX Autos index climbed about 1.8% after fresh signals of extended EV incentive support in key EU markets improved near-term visibility for legacy manufacturers. Volkswagen and Stellantis led sector gains as traders priced potential demand stabilization through year-end and early-2026 model cycles. Suppliers levered to battery value chains and charging infrastructure also outperformed. While margin headwinds from input costs persist, analysts noted that policy clarity and incentive continuity reduce ordering uncertainty, easing inventory management. Investors will watch China export trends, European registration data, and guidance updates to assess whether pricing power can be maintained without sacrificing electrification timelines.