Friday, 7 Aug 2020

European shares march higher as miners rally on fresh trade war hopes

LONDON (Reuters) – European shares marched higher on Thursday as oil prices stabilized and mining stocks rallied on hopes that China and the United States may reach a rapprochement to end their long-running trade spat, offsetting bad news in the tech sector.

The pan-European STOXX 600 index was up 0.2 percent by 0844 GMT, with German, French and Spanish bourses rising more than 0.4 percent. Britain’s FTSE 100 .FTSE was outperforming its euro zone peers as the pound fell 0.3 percent.

Sentiment was boosted after China delivered a written response to U.S. demands for wide-ranging trade reforms ahead of an expected meeting between Chinese President Xi Jinping and his counterpart Donald Trump later this month.

Basic materials stocks .SXPP, some of the main beneficiaries of easing tensions between the world’s two largest economies, led the pack with a 1.1 percent rise, also buoyed by higher copper and industrial metals prices and a weaker U.S. dollar.

British asset manager Intermediate Capital Group (ICP.L) jumped 9.4 percent to the top of the STOXX and London’s FTSE midcap index after reporting record net inflows.

French conglomerate Bouygues (BOUY.PA) rose 3.4 percent after delivering better-than-expected nine-month profits.

Autos .SXAP hit the skids, down 1.4 percent after the Chinese government doused hopes that Beijing was preparing to cut auto purchases taxes in a bid to shore up demand and boost the world’s second-largest economy.

Daimler (DAIGn.DE) was at the bottom of the DAX, also knocked by a Citi downgrade.

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