European Equities Rise as Fed Tightening Cycle Nears End

November 29, 2018
European Equities Rise as Fed Tightening Cycle Nears End

By Investors Hub

European stocks have followed their U.S. peers higher on Thursday after Federal Reserve Chairman Jerome Powell said U.S. interest rates are just below neutral, implying that the Fed’s three-year tightening cycle is drawing to a close.

Investors also remained hopeful for a de-escalation in trade tensions between the U.S. and China at the G20 summit, though a substantive breakthrough is unlikely.

While the German DAX Index has inched up by 0.1 percent, the French CAC 40 Index is up by 0.4 percent and the U.K.?s FTSE 100 Index is up by 0.6 percent.

Higher iron ore and copper prices have helped lift miners, with Anglo American, Antofagasta, Rio Tinto and Glencore all rising.

Ericsson has advanced after being selected by Volvo Car Group to provide the CVC platform to further enable its digital vehicle services in more than 120 markets worldwide for the next five years.

Automakers Daimler, Volkswagen, Renault and Peugeot have also moved to the upside despite President Donald Trump renewing threats to impose tariffs on imported cars.

Meanwhile, British media company Daily Mail & General has slumped after it warned of volatile advertising market conditions.

Intu properties has also fallen sharply in London after a consortium consisting of the Peel Group, the Olayan Group and Brookfield Property Group announced its withdrawal from a possible offer for the company.

Banks are subdued after the EU Commission said a reduction in Italy’s planned public deficit is not sufficient for the country to escape EU sanctions.

In economic news, data from the Federal Statistical Office showed Germany’s employment level in October hit a record high since reunification, while the ILO jobless rate eased from the previous month.

Employment grew by 1.2 percent or 556,000 persons year-on-year to over 45.1 million. The adjusted ILO jobless rate eased to 3.3 percent from 3.4 percent.

Dipo Olowookere

Dipo Olowookere is a journalist based in Nigeria that has passion for reporting business news stories. At his leisure time, he watches football and supports 3SC of Ibadan.

Mr Olowookere can be reached via [email protected]

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