You are here
Europe: Shares rise as US tariff suspension hopes boost autos
[LONDON] European shares gained a boost on Thursday as hopes of a softening in US trade rhetoric lifted the car sector, though trading remained cautious ahead of a US deadline to impose tariffs on Chinese goods.
The pan-European Stoxx 600 index closed with a 0.4 per cent gain for its third straight positive session. Germany's exporter-heavy DAX, meanwhile, was helped driven 1.2 per cent higher by its carmakers.
European stocks have traded in a narrow range this week in anticipation of US tariffs on US$34 billion of Chinese imports from Friday.
Sectors that have been hardest hit by the uncertainty over the trade rift made some headway on Thursday, with autos jumping 3.4 per cent and basic resources rising 1.4 per cent.
Germany's BMW, Daimler, Porsche and Volkswagen were among the biggest STOXX risers, closing up as much as 4 per cent after a report about a US offer to suspend threats to impose tariffs on cars imported from the European Union.
"Now is a good time to make a few value plays under the assumption that these trade tariffs might not actually come to fruition," said Vertex Capital analyst Jasper Reimers.
Shares in carmakers have struggled in 2018 and remain 7.8 per cent down for the year, among the worst-performing sectors in Europe.
Europe's technology sector, which came under pressure in the previous session after a Chinese court banned US company Micron from selling some of its chips in China, regained ground with a 1.2 per cent rise.
Elsewhere, company updates were in focus. Shares in France's Sodexo were the biggest Stoxx 600 gainers, up 8.7 per cent after the food services and facilities management group maintained its full-year goals despite posting slower third-quarter sales growth.
SBM Offshore was the biggest faller, down 7.2 per cent after a Brazilian court ordered Petrobras to provisionally withhold some payments to SBM to ensure the Dutch company paid whatever penalties it received in a corruption case.