By Peter Nurse
Investing.com – European stock markets traded higher Thursday, helped by China cutting tariffs on some goods imported from the U.S. as well as a swathe of strong corporate releases.
At 04:00 ET (0900 GMT), the U.K.’s index was trading 20 points, or 0.3%, higher, France’s was up 39 points, or 0.7%, while the gained 80 points, or 0.6%. The , which measures the movement of blue chip stocks in the eurozone, rose 20 points, or 0.6%. The index, a broad measure of stocks across Europe, rose 0.4% to 425.48, having hit a new record high of 426.70 earlier in the session.
China’s move to halve tariffs on $75 billion of U.S. imports from February 14 improved sentiment as it’s seen improving negotiating conditions between the two countries for a ‘phase 2’ deal – although that is widely seen as too complex to negotiate this year.
The tariff reductions come as China struggles to mitigate the economic damage of a novel coronavirus outbreak, which has so far claimed more than 560 lives.
With this wind in their sails, investors have tended to react positively to the latest European corporate earnings.
Shares in Nokia (HE:) climbed 4.6% after the Finnish telecom network equipment maker reported a surprising rise in October-December underlying profits, driven by cost cuts. It had taken a hefty hit in October after cutting its outlook and halting dividend payouts, citing the need to step up investments in 5G.
ArcelorMittal (AS:), the world’s largest steelmaker, soared 10% after it voiced optimism over the outlook for steel demand this year despite the impact from the coronavirus outbreak in China. It expects global steel demand to grow by 1% to 2% this year after expanding 1.1% in 2019.
French drugmaker Sanofi (PA:) climbed over 2% after it said its net income was up more than 18% in the fourth quarter of last year on the back of double-digit growth sales at its specialty care business Genzyme and its vaccines unit.
Shares in Total (PA:) rose over 2% after the French energy major said on it had maintained net profit at $3.2 billion for the fourth quarter of 2019 compared with the same period a year ago despite low oil prices.
And Societe Generale (PA:) climbed around 1% after the French bank revealed plans for possible stock buybacks and said profitability would improve this year, after posting an earnings miss for the fourth quarter.
Unicredit (MI:) and Nordea also rose sharply after beating expectations for profit, while ING Groep (AS:) underperformed after reporting a sharp rise in bad loan provisions.
Elsewhere, ECB President Christine Lagarde told the EU parliament that the ECB faced a much-reduced scope for policy action. That came shortly after German factory orders unexpectedly fell 2.1% in December, the biggest drop since February, and dampened the more positive mood generated by a number of confidence surveys.
Elsewhere, the oil market has pushed higher Thursday, as talks between experts from the OPEC coalition have been extended into a third day amid reports the group will agree to further cuts in production. That comes among growing signs of demand destruction in the Chinese energy complex. CNOOC, the country’s biggest gas buyer, has declared force majeure to get out of taking delivery of contracted volumes of liquefied , Reuters and Bloomberg reported, citing unnamed sources. Additionally, reports suggest China intends to cut its purchases of Saudi oil.
AT 04:05 AM ET (0905 GMT), futures traded 1.8% higher at $51.66 and the international benchmark contract rose 1.3% to $56.02.