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Europe: Stocks shunt higher before weekend

[LONDON] Europe's major stock markets pushed higher Friday ahead of the weekend, shrugging off a softer showing on Wall Street as investors remained in "wait-and-see mode," analysts said.

"It's a risk-on end to the week, in Europe anyway," said Accendo Markets analyst, Mike van Dulken.

Wall Street stocks were slightly lower as weak US inflation data for August raised questions about the odds of another Federal Reserve interest rate hike in 2017.

William Hamlyn, investment analyst at Manulife Asset Management, said European investors were waiting to see whether the eurozone's economic strength would translate into higher corporate profits as the quarterly earnings season gets underway.

"Economic activity and corporate earnings generally looks robust, and investors will be waiting for confirmation of that (in) third-quarter results," he told AFP.

"We will also be waiting for clarification of the European Central Bank's intentions." The Frankfurt-based ECB has strongly hinted that it will begin winding down bond-buying in October, although inflation in the eurozone remains well short of its target.

The London market was boosted Friday by rising oil prices - which benefits the energy and resources sector - and the softer pound.

Investors also digested news that the British economy grew 0.3 per cent in the second quarter, matching its expansion in the previous three months.

Asian equities mostly clawed higher after Mr Trump unveiled proposals that included cutting the corporate tax rate from 35 per cent to 20 per cent.

His market-friendly promise to reduce taxes, ramp up infrastructure spending and slash red tape helped drive a global rally in the months after his November election win.

But those gains had fizzled as Trump's legislative agenda suffered a series of blows and the White House has become embroiled in a host of crises.

Analysts drew comfort from the fact that Trump has worked more closely with Republican congressional leaders on the tax issue than on the failed health care reform they attempted.

Still, the tax bill is expected to face a tough passage through Congress, with both sides of the aisle likely to question its affordability.

A rise in the yen meanwhile pushed Tokyo stocks downwards on Friday. A stronger Japanese currency hurts the nation's exporters.


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