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Aug 21, 2018

European Markets at Close Report - Europe ends mostly higher as US-China trade talks draw closer I CNBC


Ryan Browne, Sam Meredith, Alexandra Gibbs


European stocks finished Tuesday's session slightly higher, as investors awaited U.S.-China trade talks, although critical comments from President Donald Trump did test market optimism.
The pan-European STOXX 600 closed up 0.27 percent provisionally, with most sectors ending the day in the black.
On the bourses front, the U.K.'s FTSE 100 fell 0.34 percent, as weakness from British-listed miners weighed. The French CAC 40 and German DAX finished on an upbeat note, up 0.54 percent and 0.43 percent respectively.
Oil and gas stocks were some of Europe's top performers, finishing up 0.94 percent as a sector amid earnings news. Energy services company Wood Group reported slightly stronger-than-anticipated figures for the first six months of the year and said its integration with Amec Foster Wheeler was progressing ahead of schedule. By the market close, the firm jumped to the top of the STOXX 600, up 7.65 percent.
Other energy stocks that boosted were top benchmark gainers including Saipem and Siemens Gamesa. A rise in oil prices, which were spurred on by the opportunity of price support from U.S. sanctions on Iran, also lifted stocks in the sector.
Basic resources stocks came under pressure, making it one of five sectors to close in the red. BHP Billiton and Rio Tinto were the worst sectoral performers. BHP reported a 33 percent jump in annual underlying profit on Tuesday. However, the world's largest miner also warned investors of a delay in future savings as well as some cost pressures over the coming months. Shares of BHP Billiton slipped over 2 percent by the close.
Looking at individual stocks, Britain's Aggreko surged over 4.5 percent after HSBC upwardly revised its stock recommendation to a "buy" from a "hold." Meantime, Metro Bank was one of the STOXX 600's biggest losers, falling over 3 percent, after Panmure Gordon cut its target price on the lender.

Trump comments

Trade talk continues to put markets on edge this week. In an interview with Reuters on Monday, the U.S. president accused Beijing of manipulating the yuan in order to try to offset trade tariffs imposed by Washington on some Chinese imports.
Trump's comments appeared to dent market sentiment ahead of upcoming trade talks between the world's two largest economies. He also said he believed the euro was being manipulated. The euro rose 0.4 percent against the dollar around Tuesday's close following Trump's comments on foreign exchange markets.
Trade officials from the U.S. and China are expected to meet in Washington this week, with market participants hopeful they might be able to find a way to resolve an ongoing global trade conflict. However, the U.S. president reportedly said he did not "anticipate much" from the discussions.
The dollar index — which tracks the greenback's performance against a basket of currencies — weakened Tuesday as traders digested fresh comments from Trump on the Federal Reserve's interest rate hiking path. Trump said he was "not thrilled" with Fed Chair Jerome Powell for raising rates.
The president's latest criticism of the Fed comes just days before Friday's much anticipated speech by Powell at the central bank's annual economic symposium in Jackson Hole, Wyoming.