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LONDON, July 5 (Reuters) - European shares rose in early deals on Thursday as hopes over a softening in U.S. trade rhetoric lifted shares in car makers, though trading remained cautious ahead of a U.S. deadline to impose tariffs on Chinese goods.
The pan-European STOXX 600 index was up 0.5 percent by 0724 GMT, while Germany's exporter-heavy DAX rose 1.1 percent, supported by autos, and Britain's FTSE 100 inched 0.3 percent higher.
European stocks have traded in a narrow range this week in anticipation of U.S. tariffs on $34 billion of Chinese imports set to go into effect on Friday.
Sectors which have been particularly hit by the uncertainty over the trade rift made some headway on Thursday, with basic resources up 1 percent, autos jumping 3.2 percent and banks rising 0.8 percent.
German autos Daimler, Porsche and Volkswagen were among the biggest STOXX risers, up as much as 3.7 percent following a report about a U.S. offer to suspend threats to impose tariffs on cars imported from the European Union.
Europe's tech sector, which came under pressure in the previous session after a Chinese court banned U.S. peer Micron selling chips, regained ground with a 1 percent rise.
Elsewhere, company updates were in focus. Shares in France's Sodexo were the biggest STOXX 600 gainers, up 7 percent after the food services and facilities management group maintained its full-year goals despite posting slower third-quarter sales growth.
However, shares in Primark-owner Associated British Foods slid 3.6 percent after the company warned again on the outlook for its sugar business, though it maintained its overall guidance for the full-year. (Reporting by Kit Rees Editing by Alison Williams)