EUROPE MARKETS: After Wild Week, Europe Stocks Trade Higher
16 August 2019 - 11:45AM
Dow Jones News
By Steve Goldstein, MarketWatch
Europe stocks traded higher on Friday, capping a wild week tied
to the U.S.-China trade dispute.
The Stoxx Europe 600 leaped 1.07% to 368.99, in a week that saw
the Euro Stoxx 60 volatility index reach its highest levels since
January.
Pharmaceuticals including Novartis (NOVN.EB) and banks including
HSBC Holdings (HSBA.LN) led the advance.
The German DAX jumped 1.01% to 11527.60 and the French CAC 40
increased 0.99% to 5288.63.
The U.K. FTSE 100 , which didn't start trading for 100 minutes
due to a London Stock Exchange glitch
(http://www.marketwatch.com/story/london-stock-exchange-outage-keeps-ftse-100-ftse-250-companies-from-trading-2019-08-16),
added 0.7% to 7116.73.
What's happening
"The 'risk off, risk on' pendulum swung back and forth as
investors grappled with conflicting signals on the U.S.-China trade
front, disappointing economic data from China and Germany and
depressed oil prices," said Lukman Otunuga, senior research analyst
at FXTM, in a note to clients.
Data released this week showed the German economy contracted in
the second quarter while China industrial production grew at the
slowest rate in 17 years. Meanwhile, data released Thursday showed
an encouraging rise in U.S. retail sales.
The U.S. yield curve remained uninverted, with the 2-year yield
at 1.56% and the 10-year yield at 1.59%.
Strategists at UBS said the yield curve inversion from earlier
in the week was a signal about growth outside the U.S.
"Statistically, we find that [German] bunds are 'causing' moves in
U.S. Treasuries, rather than the other way around. Substantively,
we see few excesses or imbalances in the U.S. economy that may lead
to growth collapsing," the strategists wrote.
The yield on the benchmark German 10-year bund was -0.70%, very
close to its all-time low of -0.73%.
Movers
IMCD (IMCD.AE) slumped 13% as the Dutch chemicals and food
ingredients company reported a 17% rise in operating profit during
the first half and reiterated it would grow its operating profit
for the whole year.
United Internet (UTDI.XE) shares rose nearly 9% even after it
lowered its outlook for the year. Its first-half profit fell after
a writedown of a stake in a cable operator.
(END) Dow Jones Newswires
August 16, 2019 05:30 ET (09:30 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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