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Jul 17, 2018

European Markets at Close ReportI CNBC

cnbc.com

earnings; Fed’s Powell addresses Congress

Silvia Amaro, Ryan Browne


Stocks in Europe closed higher Tuesday as investors digested further corporate results and monitored remarks by Federal Reserve Chairman Jerome Powell.
 
FTSE FTSE 7633.31 32.86 0.43% 517597746
DAX DAX 12665.25 104.23 0.83% 72337124
CAC CAC 5421.25 11.82 0.22% 43421827
IBEX 35 --- --- --- --- --- ---
The pan-European Stoxx 600 closed provisionally 0.3 percent higher with major bourses and sectors in mostly positive territory. Telecoms were the worst performers, off by nearly 1.5 percent, whereas basic resources rose just over 1 percent on earnings news.
Looking across the benchmark, shares of Schibsted rose almost 12 percent, leading the gains in Europe, after reporting an all-time high in earnings and 7 percent above Reuters consensus. Thyssenkrupp also jumped nearly 10 percent following news the chairman resigned after the company’s CEO left last week due to shareholder pressure. At the other end, Husqvarna dropped almost 18 percent on disappointing results. The company lowered its operating margin targets for this year.
On Wall Street, technology stocks fell, led by Netflix and Amazon, dragging the broader market lower as more corporations released their latest quarterly results.
Fed Chairman Jerome Powell is speaking to lawmakers about the Fed’s monetary policy. His testimony comes at a time when investors are paying special attention to the yield curve — which compares long and short-term interest rates — as this indicator has previously anticipated economic recessions. Minneapolis Federal Reserve Bank President Neel Kashkari said Monday that the U.S. central bank should take a break from hiking rates, because of how the yield curve is moving.

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Meanwhile, the International Monetary Fund has cut its growth forecasts for the U.K. and the euro zone, warning that tensions in global trade have darkened economic prospects. The U.S. launched five disputes at the World Trade Organization on Monday against China, the European Union, Canada, Mexico and Turkey for their retaliatory tariffs against the U.S.

Earnings

SEB rose more than 4 percent after announcing that activity picked up across different customer segments during the second quarter, despite a muted start to the year.
Goldman Sachs posted earnings that were above expectations on Tuesday. The investment bank also confirmed that David Solomon was to takeover from incumbent CEO Lloyd Blankfein when the veteran banker steps down later this year.
In terms of data, unemployment numbers in the U.K. came in at 4.2 percent on Tuesday, its lowest level since 1975.