Europe’s trade-sensitive stocks climb on news of US-China talks

Europe's trade-sensitive cars and mining shares climbed on Thursday on news of fresh US-China trade talks, though the broader market lost momentum after central bank decisions and new US sanctions on Russian and Chinese tech firms. The pan-European Stoxx 600 ended the day down 0.15 per cent, while Germany's Dax and the index of biggest euro zone stocks held on to gains of 0.2 per cent.

Car shares rose 1.1 per cent after US officials invited China to new trade talks, which the Chinese foreign ministry welcomed. Carmakers' shares have been among the biggest victims of trade tensions between the United States and its trading partners.

DUBLIN

The Iseq rose marginally to 6,629 on what was described as a quiet day with little or no company-specific news. Ryanair was dragged lower on foot of news that it is facing one-day strikes in five countries over contracts. The airline's stock traded down 1.1 per cent at €13.05.

Positive results from gambling firm GVC Holdings, which recently took over Ladbrokes Coral, was viewed as a positive for the sector, lifting Paddy Power Betfair shares nearly 2 per cent to €78.35. Financials across Europe had a relatively quiet day and Bank of Ireland saw its shares treading water at €7.37, while rival AIB rose marginally to €4.71. After publishing its first set of results on Wednesday, the Iseq's latest property reit Yew Grove rose 1.3 per cent to €1.05.

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LONDON

Britain's top share index was weighed down on Thursday by a stronger pound, while retailers fell as a strong update from supermarket group Morrisons failed to dispel competition worries. The Ftse 100 fell 0.4 per cent, as a pull-back in oil and tobacco stocks, which had pushed up the index in the previous session, outweighed gains in banks and materials.

Sterling rose after a media report said that Britain and the European Union had made progress on the Irish Border question, a major hurdle to agreeing a Brexit deal. Morrisons fell 2.1 per cent despite its first-half profit growth beating forecasts and a quarterly sales performance that was its best in nine years.

EUROPE

Tech stock rose as chipmakers and Apple suppliers AMS , Infineon, BE Semiconductor and STMicro added between 1.5 and 5 per cent as Apple launched bigger and pricier iPhones. The sector gave back some gains, however, after Washington imposed new sanctions on a China-based tech firm, its North Korean chief executive and a Russian subsidiary, accusing them of moving illicit funding to North Korea in violation of US sanctions.

Dealmaking and results led to some strong stock moves, particularly in the banking sector. French bank Natixis gained 3.1 per cent after it decided to sell several specialised finance businesses to its parent, BPCE, and use part of the €2.7 billion in proceeds for acquisitions.

News that Deutsche Bank is considering an overhaul to loosen the bond between its retail and investment banks, making it easier to merge some or all of the group with rival lenders, helped lift its shares up 2 per cent. Recent reports have suggested mergers between the two German lenders, as well as possible deals involving Italian and French banks, but banks remain the worst-performing sector in Europe year-to-date.

NEW YORK

A rise in Apple led a rebound in technology shares and boosted all three major stock indexes on Thursday, while trade worries eased after China said it was open to fresh talks with the United States. The blue-chip Dow Jones Industrial Average hit its highest since February 1st and is about 2 per cent shy of its all-time high hit on January 26th.

The S&P 500 and the Nasdaq had already moved past their January peaks to record highs in prior weeks. The technology sector climbed 1.11 per cent on the day, the most among the 11 major S&P sectors, boosted by Apple's 2.5 per cent jump. Apple, which has said tariffs could hit a "wide range" of its products, fell 1.2 per cent on Wednesday when it unveiled its largest-ever iPhone, but made only small, widely expected changes to its line-up.

The Trump administration on Wednesday invited Beijing to restart trade talks, even as Washington prepared to slap tariffs on $200 billion worth of Chinese goods. The timing of the talks remains unclear and president Donald Trump said there was no pressure to make a deal. Still, the trade-sensitive industrial sector rose 0.39 per cent. Caterpillar was up 0.7 per cent and Boeing rose 0.8 per cent. – Additional reporting by Reuters