PARIS, June 4 (Reuters) - European stock indexes climbed slowly higher on Wednesday and the dollar was little changed, as uncertainty about U.S. President Donald Trump's tariff plans and negotiations with China dominated market sentiment.
Trump has set Wednesday as the deadline for when trading partners should submit proposals for trade deals to avoid his "Liberation Day" tariffs from taking effect in five weeks' time.
Higher U.S. tariffs on steel and aluminium also took effect on Wednesday, applying to all trading partners apart from Britain, which is so far the only country to have struck a preliminary trade agreement.
The dollar-denominated MSCI All-Country index (.MIWD00000PUS), edged up to a record high, driven up over the past few weeks by the weakness in the U.S. currency, although trading remained muted as investors waited for news about a possible phone call between Trump and Chinese Leader Xi Jinping, expected some time this week.
A social media post from Trump before European markets opened hurt sentiment.
"I like President Xi of China, always have, and always will, but he is VERY TOUGH, AND EXTREMELY HARD TO MAKE A DEAL WITH," Trump said in a post on Truth Social.
The European Union's trade negotiator said he had a "productive and constructive" discussion with his U.S. counterpart on Wednesday morning.
At 1139 GMT, the pan-European STOXX 600 was up 0.4% (.STOXX), while Germany's DAX was up 0.6% (.GDAXI).
Wall Street futures pointed to tentative gains, with Nasdaq e-minis up 0.2% and S&P 500 e-minis up 0.2% .
The U.S. dollar was flat, with the dollar index at 99.202 , while the euro was up 0.1% on the day at $1.1383 .
Amelie Derambure, Senior Multi-Asset Portfolio Manager at Amundi in Paris, said she was surprised by the relative calm in markets about the threat of tariffs.
"To me there is a clear willingness of markets to believe that at the end of the day the Trump administration will not break U.S. growth," she said.
Still, there could be shifts in traders' behaviour to come as the tariffs come closer to taking effect, Derambure said.
"I think we can expect some higher volatility in the coming days up to the end of the pause in tariffs," she said.
The on-again-off-again tariffs from Trump have led to investors fleeing U.S. assets in search of safe havens, including gold and other currencies, this year as they expect trade uncertainties to take a toll on the global economy.
Traders are waiting for U.S. data later in the session to give clues as to how companies are affected by tariffs, ahead of monthly payroll data on Friday.
"The market is believing that all the back-and-forth, all the uncertainty, has not for the moment had a big impact on firms’ behaviour," Amundi's Derambure said.
"If this assumption were to change for whatever reason, because of weakening of data or because some companies will change their guidance or express more concerns, this can shift relatively rapidly."
European government bond yields were slightly higher, with the benchmark 10-year German Bund yield up 2 basis points, at 2.528% .
The European Central Bank's two-day policy meeting begins on Wednesday. The central bank is expected to cut rates on Thursday and carry on easing monetary policy, after data on Tuesday showed inflation in May easing below the ECB's target of 2%.
Euro zone business growth stalled in May, PMI data showed.
Oil prices were steady, as concerns about output increases were offset by supply pressure in Canada due to wildfires there.
Gold was helped by the weaker dollar and simmering trade tensions, up 0.1% on the day at $3,349.05 .
Reporting by Elizabeth Howcroft Editing by Alexandra Hudson
