EUROPE MARKETS: European Stock Rally Continues On Trade War Optimism And German Real Estate Boost
30 August 2019 - 12:38PM
Dow Jones News
By Callum Keown
European stocks climbed higher on Friday as U.S.-China trade war
optimism continued and German real-estate companies soared.
The Stoxx 600 enjoyed a second day of strong gains, climbing
0.8%, while the German DAX rose 1.1% and the French CAC lifted
0.9%.
What's moving the markets?
China's positive comments on Thursday continued to lift European
stocks as investors became more confident of a resolution to the
trade war.
Beijing said discussions with U.S. negotiators were continuing
and that it would not retaliate
(http://www.marketwatch.com/story/asian-markets-gain-as-latest-trade-war-fears-subside-2019-08-29)
to the latest tariff increase.
On Friday, China's foreign ministry confirmed that talks were
continuing between trade teams on both sides.
Eurozone inflation remained steady at 1%, well below the
European Central Bank's target
(http://www.marketwatch.com/story/weak-european-inflation-bolsters-case-for-stimulus-2019-08-30)
of just under 2%, fueling expectations of further stimulus next
month.
Bert Colijn, ING senior economist, said: "Headline inflation is
at 1%, with core inflation at 0.9% in August and unemployment
falling by just 16,000 in July.
"These are the final readings the ECB will get before the
important stimulus decision. Don't expect the ECB to hold
back."
However, hawkish comments from German ECB member Sabine
Lautenschläger and Dutch central bank president Klaas Knot damped
hopes of a big stimulus package.
German real-estate stocks soared after daily newspaper Bild
reported that plans for a rent freeze in Berlin could be watered
down.
Europe's largest economy showed further signs of slowing as
German retail sales suffered a sharp 2.2% fall in July.
Which stocks are active?
German property company Deutsche Wohnen (DWNI.XE) soared 11.3%
following reports that a planned rent freeze in Berlin may not be
as severe as first feared. Its larger peer Vonovia (VNA.XE) climbed
5.7%.
U.K. and Ireland-based building materials firm Grafton Group
(GFTU.LN) rose 6.4% after a rise in first-half profit. The FTSE 250
company said strong performance in its merchant and retail
businesses in Ireland, and good growth in the Netherlands, led the
rise.
(END) Dow Jones Newswires
August 30, 2019 06:23 ET (10:23 GMT)
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